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Confidence,  or  National 
Suicide  ? 


BY 

ARTHUR  EDWARD  STILWELL 


THIRD    EDITION 


NEW  YORK 
THE  BANKERS  PUBLISHING  COMPANY 

1910 


Copyright  1910 

By 

Arthur  Ed'ward  Stilwell 

New  York 


CONTENTS 


CONDITIONS—  PAGE 

Preface    v 

A  Protest   3 

Our  Country   13 

The  Englishman 21 

Mexican  Officials  as  Confidence  Builders  29 

On  Which  Side  of  the  Fence  is  the  Water?  37 
Where     is     the     Water     in     the     Great 

Northern  ? 45 

ERRORS— 

American  Wolves    ^5 

"Grabitis"   63 

Are  You  a  Lion  or  a  Zebra  ? 69 

Our  Financial  Apaches 77 

REMEDIES— 

State  Contracts   85 

The  Corporation  Court    97 

Fixed  Traffic  Rates  for  Fifteen  Years.  .  .  103 

An  American  Legion  of  Honor Ill 

Let  Us  Be  Fair!   117 


i7041- 


Respectfully  Dedicated 

to 

GEORGE  W.   WESTINGHOUSE 

whom  I  consider  one  of  the  greatest  Ameri- 
cans, and  to  whom  the  world  owes  a  debt 
of  gratitude  for  the  air  brake  and  other 
inventions. 


PREFACE 

np^HE  following  collection  of  notes  is  issued  at 
the  request  of  friends,  with  the  hope  that 
the  publication  may  call  attention  to  problems 
which  are  confronting  the  people  of  our  country 
to-day,  and  wliich  are  threatening  peril  to  Ameri- 
can railroads. 

While  considering  this  subject,  reference  will 
be  made  to  other  matters,  which  are  related  to 
and  influence  the  investment  market  of  our  coun- 
try, and  I  shall  also  lay  stress  on  some  points, 
which  I  believe  have  not  been  mentioned  by  other 
writers. 

Readers  of  these  notes  may  say  that  I,  being 
a  railroad  man,  am  prejudiced.  However,  I  offer 
my  observations,  hoping  they  will  prove  of  some 
worth. 

Is  there  a  more  important  calling  than  that  of 
a  railroad  constructor?  Is  there  any  achievement 
more  hel23f  ul  to  the  Nation  than  the  building  of 
a  railroad;  opening  up  a  virgin  territory;  devel- 
oping a  new  country ;  making  farm  lands  advance 
in  value  from  five  to  thirty  dollars  an  acre;  for- 
cing new  towns  to  spring  up,  where  happy,  healthy 


school  children  greet  us;  witnessing  the  division 
into  farms  cf  great  territories  heretofore  devoted 
to  panelling?  Xo  occupation  could  be  more  grat- 
ifjang  than  this,  which  brings  with  it  the  feeling 
that  through  the  power  which  God  has  given  us, 
we  have  been  able  to  create  homes  for  thousands 
of  settlers ;  we  have  been  able  to  watch  the  young 
men,  with  a  few  hundred  dollars,  venture  forth 
into  a  virgin  country,  soon  becoming  prosperous 
merchants  or  successful  business  men;  and  to 
witness  the  growth  of  these  newly-risen  towns 
to  three  or  five  thousands  of  inhabitants,  with 
schools  and  prosperous  business  establishments. 

It  is  given  to  but  few  to  realize  the  great 
satisfaction  that  comes  to  railroad  builders,  offi- 
cials, stockliolders  and  associates,  who  know  they 
are  bringing  growth,  strength,  and  wealth,  not 
alone  to  the  individual,  but  to  the  Nation. 

Notwithstanding  the  great  benefits  that  rail- 
roads bring  to  the  country,  are  they  now  to  be  en- 
joined by  adverse  legislation?  In  some  States 
new  railroads  cannot  be  undertaken,  or,  if  under- 
taken, have  to  struggle  for  their  very  existence 
by  the  low  rates  imposed  bj^  the  State  Railroad 
Commission,  which  forces  railroads  to  operate 
at  less  than  cost,  not  counting  interest  on  invested 
capital. 


It  is  time  for  the  people  of  America  to  resent 
the  attacks  that  are  being  made  on  railroads, 
and  efforts  that  are  organized  to  reduce  traffic 
rates,^ — now  that  labor  demands  higher  wage,  and 
cost  of  material  has  advanced. 

If  we  but  bring  the  facts  before  the  American 
public,  the  progressive  people  without  doubt,  are 
in  the  majority,  and  will  demand  justice.  They 
will  insist  that  the  railroads  shall  share  in  the 
prosperity  lately  enjoyed  by  business  and  labor. 

The  general  discrediting  of  railroad  invest- 
ments by  state  and  federal  officials  must  stop,  for 
on  the  success  of  railroads  the  life  of  the  business 
world  depends.  There  can  be  no  national  welfare 
until  railroads  prosper.  In  order  that  the  rail- 
roads may  prosper,  millions  of  dollars  are  needed 
for  extension  and  betterment.  Confidence  must 
be  established  or  money  for  development  cannot 
be  secured. 

The  failure  of  late  efforts  of  American  rail- 
roads to  raise  traffic  rates  is  a  national  calam- 
ity! Labor  demanded  increase  of  wages;  the 
cost  of  living  advanced, — but  why?  Not  be- 
cause of  higher  prices  alone,  but  the  people  have 
adopted  luxuries  which  they  formerly  did  not 
demand.  Consequently  employees  claimed  in- 
creased wages.    This  was  granted.    I  understand 


vii 


that  the  New  York  Central's  pay-roll  shows  an 
annual  increase  of  six  million  dollars  and  that  of 
the  Erie  of  about  two  million  dollars. 

As  the  matter  appears  to  me,  the  government 
was  willing  to  allow  an  increase  in  traffic  rates  to 
offset  the  increase  in  wages,  until  a  general  pro- 
test came  from  shippers.  The  rate  increase  was 
enjoined,  and  afterwards  referred  to  the  Inter- 
state Commerce  Commission. 

I  do  not  believe  that  it  really  was  the  shippers 
who  objected,  but  the  secretaries  of  various  Com- 
mercial Clubs  who  saw  an  unusual  opportunity 
for  a  "big  noise,"  which  they  had  not  had  for  a 
long  time.  They  were  employed  to  watch  rail- 
roads, and  realized  that  here  was  a  chance  they 
must  not  forego. 

Nearly  all  railroads  need  to  procure  funds  for 
development  by  additional  issues  of  securities; 
the  wonderful  growth  of  business  in  the  United 
States  demands  extensions  and  improvements. 
Stop  railroad  development,  and  you  paralyze  the 
wheels  of  progress!  Part  of  the  monej^  which 
railroads  had  secured  for  development  is  now 
being  used  for  payment  of  increased  wages; 
therefore,  many  extensions  and  improvements 
are  postponed. 


CONFIDENCE,    OR    NATIONAL 
SUICIDE? 


A   PROTEST 

'TPHE  late  financial  disturbance  in  the  United 
States  was  uncalled  for  and,  I  believe, 
might  have  been  avoided  by  the  exercise  of  good 
judgment  and  tact. 

Wide  acquaintance  in  Europe,  and  experience 
in  building  railroads  in  the  United  States  and 
Mexico, — incidentally  developing  new  territory; 
opening  and  platting  a  hundred  new  towns,  now 
with  an  aggregate  population  of  two  hundred 
thousand, — have  given  me  a  varied  view  of  life, 
ranging  from  the  counting  room  of  a  London 
bank,  to  frontier  life  in  the  United  States,  an 
experience  which,  perhaps,  comes  to  but  few  men. 

Out  of  love  for  my  own  country,  has  grown  a 
great  desire  to  see  it  come  into  its  own.  The 
calamitous  evil  in  the  United  States  of  attempt- 
ing to  gain  money  by  tricky  methods,  is  so  appar- 
ent abroad  that  everyone  should  realize  it  at 
home.  An  awful  example  was  the  exposure  of 
the  false  scales  of  the  Sugar  Trust. 

Foreign  investors  during  the  last  four  months 


4  CONFIDENCE 

have  withdrawn  from  contemplated  purchases  of 
one  hundred  and  thirty  million  dollars  of  our 
railway  bonds.  Tliis  money  was  greatly  needed 
for  proper  development  and  improvement  of  our 
railway  facilities.  These  millions  would  have 
come  to  America,  were  it  not  for  the  poisonous 
streak  of  bitter  radicalism  which  yet  lingers  in 
the  United  States  regarding  railroads,  and  the 
sinful  warfare  waged  by  bear  raiders,  harming 
all  American  property. 

New  York  journals,  recently,  have  been  un- 
tiring in  their  Herculean  efforts  to  uphold  Amer- 
ican confidence  (credit). 

There  is  no  sane  reason  for  the  present  slump 
in  American  securities;  general  financial  condi- 
tions are  not  bad;  crops  are  nearly  normal;  we 
lead  the  world  as  to  the  most  important  manu- 
factures— steel,  iron  and  cotton;  the  balance  of 
trade  is  in  our  favor ;  all  nature  is  bountiful ! 

Destructive  radicalism  started  the  panic  of 
1907 — a  devastating  electric  storm  flasliing  from 
out  the  clear  sky !  Adverse  conditions  can  always 
be  bravely  faced  by  Capital  without  complaint, 
but  radicalism  it  cannot  withstand. 

We  must  not  let  radicalism  put  its  weapons 
into  the  hands  of  the  bear  raiders! 


OR    NATIONAL    SUICIDE?  5 

The  Democratic  Gubernatorial  Nominee  of 
Texas  has  just  expressed  himself  as  opposed  to 
radicalism — a  sign  of  the  times  presaging  bless- 
ings for  that  commonwealth. 

Notwithstanding  these  conditions  are  appar- 
ent, there  seems  to  be  such  apathy  regarding 
them,  that  I  have  been  prompted  to  write  this 
protest.  We  have  seen  speculators  by  "bear"  at- 
tacks, time  after  time,  accumulate  questionable 
fortunes.  We  have  seen  men,  after  years  of 
effort,  upbuilding  great  enterprises,  wrecked  by 
a  handful  of  skilled  manipulators  and  politicians. 

I  am  appalled  by  the  popular  indifference  to 
such  methods  and  fear  a  protest  is  useless.  I  re- 
call that  years  ago  out  West,  we  hung  people  for 
stealing  horses  and  succeeded  in  cleaning  up  the 
country  of  its  boldest  outlaws.  These  men,  how- 
ever, only  occasionally  held  up  a  train,  robbed  a 
bank  here  and  there,  and  incidentally  burned  a 
few  houses. 

The  crimes  against  which  this  protest  is  made 
are  committed  with  impunity  every  day,  and  our 
nation  is  under  a  greater  obligation  to  wipe  them 
out,  than  it  was  to  kill  outlawry  in  the  West.  We 
have  done  away  with  the  great  evil  of  railroad 
rebating,  and  some  day  may  hope  to  see  stock- 


6  CONFIDENCE 

market  raiding  and  kindred  crimes,  prohibited  by 
law.  We  may  then  reahze  that  for  the  nation, 
as  well  as  for  the  individual,  honesty  as  a  pohcy 
is  best. 

It  is  far  better  to  profit  by  building  up  confi- 
dence in  the  nation  and  attracting  foreign  money, 
which  naturally  seeks  an  outlet  in  American  in- 
vestment, than  to  make  a  few  paltry  millions  by 
tricks  or  bear  raiding.  The  leading  cause  of  our 
present  unfortunate  financial  condition  is  the  pop- 
ular belief  that  there  is  no  other  road  to  political 
preferment  than,  in  some  way,  to  destroy  vested 
capital  in  railroads  and  industrial  enterprises. 
Trend  in  this  direction  during  the  last  eight  years 
has  been  so  evident,  that  people  will  believe  al- 
most any  derogatory  financial  statement. 

The  investor  has  been  hit  so  hard  in  the  past 
eight  years  that  he  is  "jumpy"  regarding  his  in- 
vestment; the  awful  panic  and  depression  of 
1907-1908  left  such  a  vivid  impression  that  cap- 
ital now  fears  shadows.  When  the  slightest  sug- 
gestion of  adverse  legislation  arises,  the  purse 
strings  of  capital  are  drawn  tight.  If,  in  some 
way,  legislation  could  be  enacted  which  would  re- 
store confidence  in  the  future  of  our  railroads; 
if   bear  raiding  could   be   eliminated;   we   soon 


OR   NATIONAL    SUICIDE?  7 

would  achieve  the  greatest  j)ossible,  national 
prosperity. 

There  is,  to-day,  need  for  the  expenditure  of 
millions  in  the  railroads,  industries,  etc. ;  yet  cap- 
ital is  afraid.  Tliis  fear  must  be  removed  or  we 
will  soon  enter  on  a  period  of  great  depression; 
if  not  actual  disaster.  We  are  at  the  forks  of  the 
road;  which  way  shall  we  turn? 

I  hope  this  protest  will  help  point  the  way 
toward  improved  conditions.  We  have  not  a 
foreign  foe  to  fear;  the  foe  is  within.  There  are 
politicians  who  hope  to  rise  to  power,  by  attack- 
ing invested  capital,  and  "bear"  raiders  who  will 
destroy  values,  or  property,  or  wreck  banks, 
merely  for  personal  gain.  If  any  foe  from  with- 
out, should  undertake  to  destroy  property  to  the 
extent  of  one-fourtli  of  the  harm  now  accom- 
plished by  foes  witliin,  we  would  impeach  a  Presi- 
dent who  failed  to  call  out  the  Army  and  Navy 
in  defense. 

Now  is  the  hour  for  prompt  action,  and  I  hope 
the  time  has  come  when  there  will  be  some  other 
way  to  achieve  greatness  in  political  life  than  by 
"knocking"  vested  capital.  I  hope  the  day  will 
come  when  we  will  hall-mark  our  stocks  and 
bonds  as  silver  is  stamped  sterling  in  England. 


8  CONFIDENCE 

The  day  will  come  when  we  in  general  will  com- 
prehend that  a  man  cannot  be  a  true  American 
who  makes  his  millions  by  destroying  financial 
confidence.  The  day  will  come  when  to  enter 
political  life  will  be  an  honor,  as  it  is  in  England, 
and  not  a  joke,  as  is  often  the  case  here. 

No  nation  has  greater  opportunities  for  gain, 
than  the  United  States,  by  the  upbuilding  of  con- 
fidence in  business  methods  and  financial  institu- 
tions. 

The  investment  money  of  the  world  would  flow 
through  our  gates  if  more  upright  methods  were 
adopted  here. 

We  have  wide,  undeveloped  territory  to  popu- 
late; many  additions  to  make  to  our  railroads. 
Eight  or  ten  years,  marked  by  freedom  from  bear 
raids  and  from  political  unrest,  would  give  the 
United  States  a  growth  in  business  and  financial 
standing  beyond  power  of  description.  To  secure 
these  great  results,  it  is  needed  that  truth  shall 
prevail  and  that  we  shall  have  straight  business 
methods.  No  condition  need  be  colored.  The 
truth  is  strong  enough. 

But  why  should  foreign  money  come  here,  if, 
each  year,  our  leading  financiers  and  politicians 
attempt  to  create  losses  in  the  market  value  of  the 


OR   NATIONAL    SUICIDE?  9 

very  securities  which  they  sold  the  year  before, 
gilded  with  glowing  promises?  Were  they  de- 
ceiving investors  then  or  now?  We  need  only 
look  to  the  wonderful  development  now  taking 
place  in  Canada;  two  railroads  building  to  the 
Pacific;  railroad  extension  of  all  kinds;  wonder- 
ful growth  in  population,  alluring  thousands  of 
our  people;  new  cities  springing  into  existence; 
millions  for  investment  pouring  in, — and  why? 
The  Government  is  aiding  railroads,  guarantee- 
ing interest  on  loans.  It  is  easy  to  secure  money 
for  railroads  when  the  Government  is  fair,  and 
hence  this  great  growth  and  the  greatest  era  of 
prosperity  Canada  has  ever  known,  side  by  side 
with  fear  and  stagnation  in  this  adjoining  land. 


OUR    COUNTRY 


OUR    COUNTRY 

WE  live  in  a  wonderful  land,  blessed  as  is  no 
other,  a  land  of  wide  extent  and  various 
climates.  The  Scandinavian  or  Teuton  may  find 
the  Northwest  suited  to  him;  the  Itahan,  the 
South.  The  soil  varies  so  that  nearly  everything 
which  can  be  grown  is  to  be  found  in  some  part  of 
the  country.  It  yields  all  metals,  and  ranks  sec- 
ond in  the  world  in  the  production  of  gold,  and 
first  as  to  iron  and  steel.  Our  crops  annually 
are  valued  at  some  eight  billions  of  dollars. 

The  United  States  increases  nearly  one  hun- 
dred and  thirty  thousand  per  month  in  pop- 
ulation. If  you  should  read  in  the  paper  that  all 
the  inhabitants  of  Holland  and  Belgium  were  to 
immigrate  into  the  States  in  five  years,  it  would 
make  a  great  impression  on  your  mind,  yet  our 
increase  in  population  would  in  five  years  equal 
the  population  of  those  countries. 

Our  growth  in  numbers,  in  the  last  ten  years, 
is  equal  to  one-third  the  population  of  Great 
Britain.  We  are  a  mixed  race,  containing  the 
best  blood  of  all  nations;  that  is,  the  young  and 
vigorous  come  here. 

We  are  not  hke  some  nations,  finished ;  we  are 

13 


14  CONFIDENCE 

in  the  making.  Our  inhabitants  breathe  an  at- 
mosphere of  business  activity.  They  are  sur- 
rounded by  new  buildings,  engaged  in  new  enter- 
prises, and  trying  to  become  accustomed  to  new 
inventions. 

No  one  will  talk  to  an  idle  man,  so  if  you  want 
to  retire  from  business,  you  find  you  must  go  to 
Europe  in  order  to  talk  to  someone.  Oppor- 
tunities exist  on  every  hand;  we  grow  great  trees; 
erect  high  buildings;  build  great  railroads;  have 
big  panics  and  big  booms;  we  make  great  mis- 
takes quickly,  and  sometimes  rectify  them  just  as 
quickly.  We  are  so  engrossed  in  the  fight  for 
gold  that  we  do  not  always  give  as  much  thought 
as  we  should  to  a  matter  before  we  act;  we  are 
impulsive,  but  in  the  long  run,  will  be  found  on 
the  right  side. 

There  is  endless  chance  for  the  investment  of 
capital;  for  years,  foreign  money  has  poured  in 
on  us,  yet  we  need  more.  Progress  creates  pro- 
gress. There  are  good  reasons  why  we  need  cap- 
ital, a  few  of  which  I  will  mention.  To  keep  this 
country  on  top,  we  must  pay  more  attention  to 
building  up  confidence,  and  less  to  "YAP."  The 
word  is  perhaps  vulgar,  but  I  cannot  find  any 
other  that  better  expresses  my  meaning. 


OR    NATIONAL    SUICIDE?         15 

"Yap"    is    talk,    without    truth    back    of    it; 
"Yap,"  is  shouting  baleful  ideas  which  you  do 
not  believe;  it  is  the  talk  of  politicians  who  are 
attempting  to  impress  upon  their  hearers  the  idea 
that  their  lives  are  the  essence  of  the  ten  com- 
mandments,  when  they   know   that   they   have 
broken  nine  and  hopelessly  cracked  the  tenth. 
"Yap"  is  the  great  asset  of  the  bear  raider,  who  is 
doing  all  in  his  power  to  destroy  confidence  in 
America  and  American  investments,  and  has  in 
view  the  lining  of  his  own  pockets  with  ill  gotten 
gains.     He  is  willing  to  say  or  do  anything,  in 
order  to  destroy  any  sacred  structure  in  his  way, 
if  it  will  only  add  to  his  gains.    Of  late,  "Yap" 
has  had  full  swing,  and  while  it  has  tried  to  sway 
our  nation  into  wrong  paths,  it  cannot  mislead  it 
forever.    It  will  soon  be  recognized  for  what  it  is 
and  then  will  have  no  more  power  than  "the 
voiceless  lisping  of  a  gas  leak." 

The  United  States  can  furnish  most  attractive 
investments  for  foreign  capital,  if  we  do  not  scare 
it  by  destroying  confidence  in  the  nation.  For- 
eign capital  will  buy  our  stocks  and  bonds  in 
large  blocks,  and  why  not?  All  Europe  sees  the 
American;  he  fills  the  hotels;  he  furnishes  sixty 
per  cent,  of  all  the  first-class  traffic  on  the  rail- 


16  CONFIDENCE 

road  and  steamsliip  lines  during  the  travel  sea- 
son ;  he  buys  with  a  liberal  hand.  Europe  blesses 
him  each  season,  when  the  travel  tide  is  turned 
that  way.  The  European  sees  the  Americans 
in  the  light  of  a  liberal  and  generous  people; 
he  knows  the  prosperity  that  American  money 
brings  to  liis  shops,  hotels,  etc.,  and  he  will,  in 
turn,  invest  his  money  with  us,  if  we  will  build 
up  national  confidence.  We  need  liis  monej^  and 
it  will  be  a  great  error,  if  we  see  this  capital  di- 
verted elsewhere,  as  is  now  the  case. 

Here  are  a  few  reasons  why  trade  balances 
will  be  against  us ;  first,  owing  to  large  home  in- 
crease in  population,  in  the  next  decade,  the  last 
cargo  of  wheat  will  have  left  our  shores;  we  will 
need  it  all  at  home,  and  ^vill  be  forced  to  import 
wheat  from  Canada  and  the  Argentine.  Sec- 
ond, the  widening  stream  of  Americans  going 
abroad  each  year  will  continue  to  increase,  year 
by  year.  It  is  now  difficult  to  book  steamship 
passage,  during  the  travel  season,  in  spite  of  the 
constantly  increasing  number  of  ships.  This  for- 
eign travel  sends  abroad  over  three  hundred  mil- 
lion dollars  each  year.  Our  rich  young  women 
who  marry  foreign  titles,  carry  abroad  yearly,  a 
sum  that  runs  far  into  the  millions.     We  will 


OR    NATIONAL    SUICIDE?         17 

export  less  and  less  cotton,  for  two  reasons, — 
greater  demand  at  home  because  of  increased  pop- 
ulation, and  increase  in  the  production  of  cotton 
along  the  Nile  and  in  Central  Africa  and  India. 
All  efforts  possible  in  those  countries  are  being 
made  by  English  cotton  manufacturers,  in  order 
to  free  the  English  market  from  the  wildly  fluc- 
tuating American  cotton  market. 

Another  adverse  force  to  which  little  thought 
is  given,  is  that  millions  of  dollars  are  exported 
to  the  old-world  homes  of  immigrants.  Much 
mone^'^  is  taken  abroad  each  year  by  Italians,  who 
never  expect  to  return.  Any  railroad  contractor 
will  tell  you  that  the  money  paid  to  his  Italian 
laborers  (less  that  which  is  used  for  living  ex- 
penses) is  withdrawn  from  circulation;  all  the 
Italian  saves,  goes  into  his  belt,  and  remains  there 
until  he  returns  to  Italy. 

An  Italian  stated  to  one  of  our  shareholders, 
on  one  of  the  islands  south  of  Italy: — "With 
four  good  chestnut  trees  furnishing  my  flour,  and 
with  four  goats,  I  can  live  well,  and  support  my 
family;  so  why  longer  remain  in  the  United 
States,  after  earning  money  with  which  I  can  buy 
the  trees  and  the  goats?"  Tliis  belief  annually 
removes  milhons  of  dollars  from  our  country. 


18  CONFIDENCE 

Such  drains  must  be  offset  in  either  one  of  two 
ways;  by  increased  sale  of  manufactured  goods, 
or  by  sale  of  our  securities. 

We  are  not  doing  our  duty  toward  capturing 
the  trade  of  South  America.  We  plaster  it  over 
with  the  Monroe  Doctrine  in  words,  but  the  Eng- 
lish and  German  nations  capture  it  with  their 
trade.  We  hold  the  Monroe  Doctrine  in  our 
dreams,  wliile  the  foreigners  get  the  business. 

There  is  left  to  us  the  sale  of  our  bonds  and 
shares  in  the  markets  of  the  foreign  world,  as  our 
interest  rates  are  more  attractive  to  the  foreigner 
than  to  our  own  investors,  money  here  being  in 
such  active  demand. 


THE    ENGLISHMAN 


THE   ENGLISHMAN 

"Others  may  use  the  Ocean  as  their  road; 
Only  the  English  make  it  their  abode, — 
Whose  ready  sails  with  every  wind  can  fly 
And  covenant  make  with  the  inconstant  sky." 

'T^HE  Englishman  is  the  most  successful  colon- 
"^  izer  and  settler  that  the  world  has  ever 
known.  He  governs  one-fifth  of  it  and  rules 
over  one-fourth  of  the  population. 

He  thinks  in  continents. 

English  universities  and  lier  Church  have  im- 
pressed their  mark  on  the  world. 

Wherever  the  English  flag  flies,  investments 
are  safe.  Of  chief  importance,  his  Government 
is  clean. 

Everywhere  he  is  the  pioneer  and  his  flag  flies 
in  every  port  of  the  world. 

He  lands  in  New  Zealand,  teaches  the  natives 
to  plant  and  grind  grain,  and  soon  New  Zealand 
is  part  of  the  Empire.  He  founds  a  convict 
colony  at  Botany  Bay,  adding  a  new  continent 
to  the  realm.  He  founds  the  East  India  Com- 
pany, wrests  the  trade  of  that  Empire  from  the 

21 


22  CONFIDENCE 

Dutch  and  Portuguese,  bringing  home  the  wealth 
of  India. 

He  develops,  explores  and  colonizes  Canada 
and  the  Northwest  by  founding  the  Hudson  Bay 
Company,  and  the  steel  ribbon  of  his  railway  ex- 
tends from  Halifax  to  Vancouver. 

He  explores  the  wilds  of  Russia;  penetrates 
Thibet,  reaching  the  forbidden  city  of  Lhassa; 
penetrates  to  within  a  hundred  miles  of  the  South 
Pole. 

The  Englishman  marches  into  unexplored 
regions,  makes  terms  wath  the  native  chief,  and 
the  flag  of  England  flies  over  one  more  pro- 
tectorate ;  the  light  of  civilization  arises  from  the 
earth  that  had  reeked  with  the  blood  of  victims 
captured  in  war;  in  after  years,  the  son  and 
grandson  of  this  bloody  cliief  study  in  English 
schools,  to  carry  the  seed  of  education  to  germi- 
nate in  their  old  homes,  there  implanting  the  love 
of  the  English  flag,  and  the  progress  for  which  it 
stands. 

He  fishes  for  pearls  in  India;  grinds  into  paper 
pulp  the  spruce  of  Newfoundland;  makes  soap 
in  Holland;  erects  packing  houses  in  Uruguay 
and  Paraguay;  bottles  waters  in  Germany  and 
brews  beer  in  Brazil. 


OR   NATIONAL    SUICIDE?         23 

The  Englishman  herds  sheep  in  Austraha  and 
New  Zealand;  penetrates  the  forests  of  Brazil 
for  rubber  and  plants  it  in  Ceylon ;  plants  cotton 
on  the  highlands  of  Central  Africa ;  sails  the  Nile 
and  reclaims  its  lost  tracts  of  desert,  to  yield  a 
thousand  fold;  grows  tea  in  Ceylon  and  India, 
spans  its  torrents,  and  explores  its  fastnesses  with 
rails  of  commerce. 

He  institutes  banks  in  all  new  countries  with 
branches  in  London,  and  his  Bank  of  England 
fixes  the  discount  rate  for  all  the  world. 

The  Englishman  drills  for  oil  in  India,  Russia, 
Persia,  the  States  and  Mexico;  builds  refineries 
and  establishes  steamship  lines  for  carrying  oil  to 
all  continents. 

He  digs  for  coal  in  China;  mines  nitrates  in 
Peru;  prospects  for  ore  in  Russia;  delves  in  the 
mines  of  the  Rand;  redeems  West  Africa,  and 
opens  its  treasure  house  of  gold. 

He  builds  great  sewerage  systems  and  docks  in 
Mexico,  wharves  in  Uruguay,  and  equips  the 
cities  of  Argentine  with  trams  and  electric  lights. 

The  Englishman  harnesses  the  water-falls  of 
Brazil  and  Mexico  and  furnishes  electric  light 
and  power  to  their  cities.  He  operates  trams  in 
Calcutta,  constructs  railroads  in  Turkey,  and 
controls  the  Suez  Canal. 


24  CONFIDENCE 

He  spans  Tehuantepec,  linking  the  Atlantic 
with  the  Pacific;  owns  the  railroads  of  Peru; 
climbs  the  Andes  and  connects  the  Argentine 
vnih  Chili;  and  realizing  Cecil  Rhodes'  dream, 
runs  a  railway  from  Cape  to  Cairo. 

Such  is  the  Englishman;  his  word  is  his  bond; 
he  is  square  in  his  dealings.  All  he  wants  is  his 
share.  He  is  a  sportsman,  loving  horses,  cricket 
and  football.  Worcestershire  sauce,  evening 
dress,  and  Bass'  ale  follow  the  English  flag. 

He  does  not  care  for  great  wealth  and  knows 
when  to  retire,  not  to  die  in  harness.  He  is  the 
best  friend  in  the  world  and,  once  you  win  his  con- 
fidence, it  is  your  fault  if  you  do  not  keep  it  to 
the  end. 

He  trades  in  every  clime;  he  has  been  God's 
right  hand  agent  in  hastening  the  hands  of 
progress. 

Macaulay  says: — "The  history  of  England  is 
the  history  of  progress." 

The  numerous  tongues  disseminated  after  the 
fall  of  the  Tower  of  Babel  are  being  more  and 
more  unified,  as  Enghsh  is  becoming  the  lan- 
guage of  the  commercial  world. 

The  Englishman  has  milhons  of  money  in  our 
enterprises  and  is  willing  to  invest  more. 


OR    NATIONAL    SUICIDE?         25 

We  speak  his  tongue;  we  inherit  his  daring. 

England  is  for  miUions  of  us  the  home  of  our 
ancestors;  we  glory  in  this,  but  we  need  never 
imagine  that  New  York  may  wrest  from  London 
its  great  power  as  the  financial  center  of  the 
world,  unless  New  York  adopts  some  of  Lon- 
don's strict  integrity  in  business. 

Then  and  not  till  then,  may  New  York  achieve 
this  world  distinction. 


MEXICAN     OFFICIALS     AS     CONFI- 
DENCE BUILDERS 


MEXICAX     OFFICIALS     AS     CONFI- 
DEXCE    BUILDERS 

"ItiTEXICAX  officials  have  been  most  success- 
ful  in  building  up  national  confidence. 
What  great  difficulties  have  been  overcome  there 
in  the  last  thirty  years!  Thirty  years  ago  there 
was  scarcely  any  foreign  money  invested  in  Mex- 
ican securities,  and  now  we  find  one  billion  five 
hundred  million  dollars  foreign  capital  there 
placed  and  nowhere  is  foreign  money  more 
secure. 

What  a  number  of  cases  can  be  cited  to  illus- 
trate this!  I  will  mention  tw^o  which  have  come 
under  my  personal  observation.  Eight  years  ago 
a  branch  railroad  in  Mexico  was  offered  to  me 
on  favorable  terms.  A  syndicate  was  ready  to 
take  it,  if  I  could  connect  it  with  the  Orient  rail- 
way. To  do  that,  I  had  to  traverse  part  of  the 
territory  of  the  jNIexican  Central  Railroad.  I 
went  to  President  Diaz,  to  ask  him  for  the  con- 
cession, little  thinking  of  anything  except  the  fact 
that  this  would  be  a  very  favorable  railroad  con- 
nection for  us  to  make.     I  did  the  best  in  my 

29 


30  CONFIDENCE 

power  to  la}^  the  case  before  him,  in  tlie  hght  in 
which  I  saw  it.  He  listened  to  me  and  then  point- 
ing on  a  map  said  thoughtfully,  "Senor  Stil- 
well,  you  do  not  wish  this!  To  make  your  con- 
nection, you  have  to  enter  the  Mexican  Central 
territory,  through  a  section  where  there  is  not 
very  much  business.  You  would  hurt  the  Mexi- 
can Central  Road,  and  would,  perhaps,  help  your 
own  road  for  the  time  being ;  but  you  cannot  hurt 
any  Mexican  investment  without  injuring  your 
own  road  in  the  long  run.  No,  there  is  plenty 
of  chance  for  investment  of  capital  in  Mexico,  in 
sections  that  need  development  and  where  in- 
vested capital  will  not  be  hurt.  Use  your  energy 
in  those  sections,  but  do  not  ask  me  for  conces- 
sions that  would  in  any  way  injure  invested  cap- 
ital or  make  its  burden  greater." 

This  was  a  rebuke  and  the  matter  was  dropped, 
yet  very  often  in  the  ]3ast  few  years  I  have  re- 
called the  incident  and  wondered  what  our  future 
would  be  if  the  people  in  power  in  the  United 
States  would  so  guard  as  a  sacred  trust,  the  in- 
terests of  invested  capital. 

One  more  illustration!  A  trust  company  in 
the  States  had  a  large  portion  of  its  money  locked 
up  in  bonds  of  a  railroad  in  Central  Mexico. 


OR    NATIONAL    SUICIDE?         31 

During  one  of  the  biennial  panics  to  which  the 
United  States  is  subject,  this  company  failed  with 
five  million  dollars  of  these  bonds  as  one  of  its 
assets;  the  Mexican  Government  at  once  guar- 
anteed the  bonds  and  the  trust  company  was  able 
to  liquidate.  Effort  was  not  made  to  crush  the  in- 
vestors and  save  a  million  for  Mexico,  but  every- 
thing possible  was  done  to  prevent  anyone  losing 
on  a  Mexican  investment.  How  different  it 
would  be  in  New  York ! 

The  Mexican  Government  bought  control  of 
the  majority  of  the  stock  of  the  ^Mexican  Nation- 
al Railwa}'  and  with  the  support  of  the  Govern- 
ment it  was  easy  for  the  road  to  raise  money.  In 
addition  to  the  backing  of  the  Government,  the 
road  was  fortunate,  in  having  Mr.  E.  N.  Brown, 
a  railroad  man  of  great  and  recognized  ability 
as  its  president.  The  policy  pursued  by  the  man- 
agement soon  put  the  road  in  excellent  shape, 
both  physically  and  financially.  Then  the  Gov- 
ment  turned  its  attention  to  the  Mexican  Central, 
which  had  been  at  the  end  of  its  string  for  money, 
and  purchased  the  controlling  interest.  It  is  my 
conviction  that  the  Government  took  hold  of  the 
Central,  not  alone  for  the  future  of  the  road,  but 
because  President  Diaz  and   Secretary  Liman- 


32  CONFIDEXCE 

tour,  one  of  the  greatest  living  financiers,  believed 
that  Government  intervention  was  the  only  thing 
that  would  avert  a  receivership.  They  were  un- 
willing that  such  a  disaster  should  overtake  a 
prominent  Mexican  road  and  weaken  the  con- 
fidence of  the  investors  of  the  world  in  Mexican 
investments. 

Another  reason  for  the  assurance  placed  in 
Mexican  investments  by  foreign  investors,  is  the 
fact  that  the  Government  has  bought  control  of 
a  majority  of  the  stock  of  sixty  per  cent,  of  the 
railroads  of  Mexico.  This  always  will  prevent 
injury  to  railway  investors  and  is  a  wonderful 
tribute  to  the  men  at  the  head  of  the  Mexican 
Government,  that  in  so  short  a  time,  full  confi- 
dence there  has  been  established. 

I  have  had  the  pleasure  of  personally  intro- 
ducing over  fourteen  hundred  American  and 
English  business  men  to  President  Diaz,  Vice- 
President  Corral  and  Secretary  Creel,  and  have 
noted  with  gratification  the  favorable  impression 
these  officials  made  on  my  friends. 

I  rejoice  that  it  has  fallen  to  my  lot  to  aid  in 
cementing  a  friendship  between  the  United  States 
and  Mexico  and  to  help  develop,  in  a  small  way, 
tlie  I'esources  of  that  wonderful  country,  which 


OR    NATIONAL    SUICIDE?         33 

has  no  politician  hoping  to  acliieve  power  by  the 
destruction  of  investments  and  confidence.  In 
jMexico  bear  raids  and  short  selHng  are  unknown. 
The  Mexican  President  is  a  wise  business  man. 
I  beheve  that  few  men  ever  walked  the  earth,  who 
possessed  the  business  sense,  high  honor  and  re- 
markable judgment  and  foresight  of  President 
Diaz. 

If  people  of  the  United  States  would  elect  as 
President  a  great  business  man,  such  as  the  late 
Marshall  Field,  or  Andrew  Carnegie,  I  think  it 
would  be  found  that  such  a  business  mind  would 
be  a  valuable  asset  to  the  nation.  Why  do  we  not 
elect  a  business  man  to  the  Presidency? 


ON  WHICH  SIDE  OF  THE  FENCE  IS 
THE   WATER? 


ON  WHICH  SIDE  OF  THE  FENCE  IS 
THE  WATER? 

/^NE  of  the  favorite  remarks  of  those  who 
^■^  want  to  fight  the  raih'oads  is: — "We  must 
squeeze  the  water  out  of  the  railroads,  so  that 
they  will  not  pay  dividends  on  it!"  We  will  ad- 
mit for  argument's  sake  that  there  is  water  in  the 
railroads.  Who  wants  to  huild  railroads  for  the 
fun  of  the  thing?  There  are  two  classes  of  peo- 
ple; optimistic  and  pessimistic;  one  sees  the 
doughnut,  the  other  sees  the  hole.  Without  the 
blessings  conferred  by  the  optimist,  the  dear  old 
pessimist  would  never  have  any  place  on  earth  in 
which  to  invest  his  money,  since  he  never  creates 
anything;  he  only  buys  what  the  optimist  has 
created,  meanwhile  finding  fault  with  every  new 
work  that  the  optimist  undertakes. 

Now  let  us  analyze  the  water  in  the  railroads 
and  see  if  it  is  not  deeper  outside,  than  inside  the 
railroad's  right-of-way.     It  seems  thus  to  me. 

Note  the  Kansas  City  Southern  which  1  built. 
It  is  800  miles  long.  It  opened  up  sections  of 
country,  where  previously  you  could  not  give 


38  CONFIDENCE 

the  land  away.  Cities  sprang  up,  which,  during 
ten  years,  have  acquired  a  population  of  eight. or 
ten  thousand  and  assessed  values  of  millions. 
The  great  coal  belt,  south  of  Fort  Smith,  was 
opened  up ;  miles  of  long  and  short  leaf  pine  ter- 
ritory w^ere  brought  into  the  market.  This  land 
was  sold  for  two  dollars  per  acre  before  the  road 
went  through;  now  it  is  sold  for  five  dollars 
per  thousand  stumpage, — or  fifty  to  seventy- 
five  dollars  per  acre.  Over  a  hundred  mills  now 
cut  lumber  in  this  territory.  Thousands  have 
found  occupation,  where  before  there  was  no 
business  at  all,  through  at  least  five  hundred 
miles  of  this  territory.  Two  great  oil  fields  have 
been  developed  by  the  railroad.  The  coal  lands 
are  now  worth  at  least  one  thousand  dollars  per 
acre;  to  tliis  we  must  add  increased  value  of 
the  oil  and  timber  lands.  Then  there  is  the  great 
mineral  belt  south  of  Joplin!  Note  the  value  of 
town  lots,  where  towns  did  not  previously  exist! 
There  is  a  strip  of  land,  thirty  miles  wide,  on 
each  side  of  the  railroad,  where  the  average  in- 
crease in  values  has  been  fourfold.  The  coal  and 
oil  and  the  townsites  add  to  this  increase,  which 
I  have  no  doubt  ^aiII  reach  forty  dollars  per  acre. 
There    are    in    this    strip    forty-eight    thousand 


OR    NATIONAL    SUICIDE?         39 

square  miles  or  tliirty  million  seven  hundred  and 
twenty  thousand  acres.  If  it  has  increased  in 
value  say  but  twenty  dollars  per  acre,  the  gain  is 
six  hundred  and  fourteen  million  four  hundred 
thousand  dollars;  all  this  brought  to  the  pubhc 
by  a  railroad  huilt  hy  optimists.  The  railroad 
created  these  new  values  while  the  owners  slept! 

Now  suppose  the  railroad  builders,  in  time, 
make,  through  their  judgment,  fifty  million  or 
seventy-five  million  dollars  above  the  cost  of  the 
road;  do  not  capitalists  who  have  had  the  nerve 
to  bring  such  increased  prosperity  to  this  terri- 
tory, deserve  credit,  reward  and  profit? 

Is  it  selfish  if  the  railroad  builders  ask  that  they 
shall  be  rewarded  with  one-twelfth  of  what  they 
have  made  for  others  ?  Capital  needs  encourage- 
ment. 

If  you  want  to  squeeze  the  water  out  of  the 
railroads,  do  you  also  want  to  squeeze  it  out  of 
the  land  values?  If  it  is  not  fair  for  railroads  to 
prosper,  it  is  not  fair  that  land  values  (which  the 
roads  have  created, )  shall  increase.  It  is  not  fair 
to  deny  the  creator  of  those  values  unless  we  deny 
the  created. 

What  a  howl  would  go  up  from  owners  of  land 
in  this,  or  in  any  new  railroad's  territory,  if  the 


40  CONFIDENCE 

Interstate  Commerce  Commission,  or  the  State 
Railroad  Commission,  were  to  fix  the  price  at 
wliich  land  could  be  sold!  The  increased  real 
estate  values  were  made  through  the  courageous 
investment  of  capital  which  built  the  road. 

Consider  the  good  fortune  conferred  by  the 
Union  Pacific  in  opening  up  the  mining  sections 
of  the  West,  adding  millions  of  gold  production 
from  mines  which  never  could  have  produced  be- 
fore the  advent  of  the  road. 

"Yes,  there  is  "water,"  (if  you  call  increased 
value,  "water"),  in  our  railroads, — and  thank 
God  for  it !  It  was  the  prospect  of  this  increased 
value  which  made  possible  the  creation  of  rail- 
roads. But  rest  assured;  that  the  "water"  added 
to  the  value  of  the  adjoining  lands,  (we  will  call 
the  increase  in  land  values,  "water,"  for  it  is  as 
fair  in  the  one  case  as  in  the  other) ,  is  twelve 
times  the  amount  of  the  water  in  the  railroad 
securities!  No  objection  is  raised  by  land  owners 
along  the  railroad,  whose  properties  have  been 
increased  in  value  by  the  building  of  the  railroad. 
Is  not  the  water  deej^er  on  the  outside  than  inside 
of  the  railroad's  right-of-way? 

I  will  cite  another  benefit  derived  from  the 
building  of  the  Kansas  City  Southern.    The  ad- 


OR    NATIONAL    SUICIDE?         41 

vent  of  the  road  enabled  fifty  thousand  people  to 
find  employment  in  mills,  forests,  stores,  etc.  The 
average  wage  of  each  laborer  is  two  dollars  per 
diem ;  here  is  one  hundred  thousand  dollars  a  day, 
increase  in  the  earning  capacity  of  American 
men.  Tliis  is  thirty  million  dollars  per  annum. 
Consider  the  benefit,  conferred  on  all  business,  in 
the  creation  of  such  an  addition  to  the  earning 
power  of  labor.  At  least  two  hundred  million 
dollars  found  safe  investment  in  this  territory. 
The  railroad  made  Kansas  City  a  great  grain 
market  and  a  great  lumber  market.  This  one 
railroad  has  increased  the  value  of  land  six  hun- 
dred and  fourteen  million  four  hundred  thousand 
dollars;  gives  employment  to  labor  to  the  extent 
of  thirty  million  dollars  per  annum;  presents  op- 
portunity for  the  investment  of  two  hundred  mil- 
lion dollars,  in  local  industries,  mines,  and  stores. 

Do  not  the  creators  of  such  colossal  values  de- 
serve "water,"  if  that  is  the  proper  name  for 
profit?  Does  this  railroad  not  deserve  ample  re- 
turns and  abundant  profits  from  the  people  it 
serves  ? 

In  England,  men  who  created  such  properties 
for  the  upbuilding  of  the  nation  would  be 
honored. 


42  CONFIDENCE 

In  the  United  States,  however,  the  promoters 
and  builders  are  hounded.  Tricks  of  all  kinds  are 
tried,  and  dishonest  methods  employed,  in  at- 
tempts to  wrest  the  property  from  them ;  methods 
which  would  make  Judas  Iscariot  look  like  an 
archangel  and  put  the  forty  thieves,  with  halos 
among  the  saints. 

Have  not  merchants,  manufacturers  and  bank- 
ers seen  "water"  come  into  their  own  business? 
You  are,  we  will  say,  a  wholesale  merchant. 
Your  business,  stock  and  store  have  a  value  of  one 
million  dollars,  which  is  the  asset  value ;  you  earn 
and  pay  dividends  on  two  million  dollars,  consid- 
ering j^our  established  trade  and  good  name  the 
additional  million, — and  you  would  not  sell  out 
for  less.  Is  this  extra  milHon  "water"?  If  it  is 
fair  to  earn  dividends  on  this  "water,"  is  it  not 
fair  also  for  the  holders  of  railroad  stocks  to  earn 
on  the  "water"  in  their  road? 

Men  who  take  financial  risks  are  entitled  to 
profit !  If  all  the  railroad  bonds  and  shares  were 
guaranteed  by  the  state  or  the  nation,  it  would 
be  very  different.  Railroads  assume  great  risks, 
— of  crop  failures,  damage  by  storms,  etc.  Fair 
treatment  and  just  rates  are  the  necessary  requi- 
sites to  attract  investors,  now  sorely  needed  for 
development  of  this  expanding  country. 


WHERE  IS  THE  WATER  IN  THE 
GREAT  NORTHERN? 


WHERE    IS    THE    WATER    IN    THE 
GREAT    NORTHERN? 

'T^HE  Great  Northern  Railroad  has  some 
seven  thousand  miles  of  track.  This  was 
the  creative  work  of  James  J.  Hill:  his  energy, 
his  foresight,  and  his  alone,  built  this  road.  He 
was  laughed  at,  as  I  was  when  building  the  Kan- 
sas City  Southern, — pronounced  a  dreamer,  and 
the  territory  the  road  was  to  open  was  called  a 
desert. 

The  railroad  men  of  his  section  said:  "Wait 
until  ties  must  be  renewed  and  then  see  where 
he  will  be"!  But  Mr.  Hill,  like  all  men  whom 
destiny  has  chosen  for  such  work,  could  see  the 
end,  though  no  one  else  foresaw!  It  was  the 
prophetic  vision  of  James  J.  Hill,  (withheld  from 
others),  which  enabled  liim  to  keep  up  the  fight, 
midst  crop  failures,  panics,  slander, — and  yet 
live,  striving  to  give  service  to  the  world. 

James  J.  Hill,  in  building  the  Great  Northern, 
was  positive  that  his  message  of  prosperity  and 
beneficence  was  to  be  delivered  at  the  Pacific 
Coast.    He  carried  the  message  to  Garcia!    And 

46 


46  CONFIDENCE 

what  a  message  it  was,  written  on  the  ground  in 
characters  of  steel!  What  a  blessing  it  was  for 
that  wonderful,  unoccupied  country!  Cities 
sprang  up ;  millions  of  acres  responded  to  the  song 
of  the  plow!  Aladdin's  lamp  never  produced  so 
wonderful  a  vision  as  this  reality, — millions  of 
homes,  great  waving  fields  of  grain!  Giant 
trees,  that  for  centuries  had  resisted  all  stress  of 
seasons,  and  all  foes,  became  the  subjects  of  this 
King  of  Commerce.  Can  you  not  see  the  pic- 
ture? What  benefits  Hill  conferred  on  the  nation ! 
It  was  not  a  distant,  intangible,  protectorate; 
not  like  the  Pliilippines — over  seas!  Here  was 
an  empire,  within,  yet  added  to  our  own  sleep- 
ing country!  Let  us  admit,  that  what  Hill  had 
done,  some  one  else  might  accomplish  at  a  later 
day;  but  Hill  was  ten  years  in  advance  of  the 
times.  Figm-es  are  cold,  and  words  are  weak  to 
tell  the  story.  What  a  gift  tliis  was  from  one 
empire  builder! 

The  human  mind  scarcely  can  comprehend  all 
the  benefits  conferred  through  the  building  of  the 
Great  Northern,  but  let  us  try  to  enumerate  some 
of  these. 

The  Great  Northern  has  seven  thousand  miles 
of  track.    Figure  that  two  thousand  miles  of  this 


OR    NATIONAL    SUICIDE?         47 

territory  would  have  been  developed  by  other 
railroads,  so  in  only  five  thousand  miles  of  the 
seven  thousand  is  development  credit  strictly  due 
to  Mr.  Hill's  enterprise. 

Figure  that  the  Great  Northern  has  increased 
land  values  but  twenty  dollars  per  acre  in  five 
thousand  miles  of  its  territory.  We  will  say  that 
land  for  only  fifty  miles  on  either  side  of  the 
track  was  increased  in  value.  I  am  convinced, 
considering  increased  values  of  all  the  cities  and 
towns  brought  into  being  by  this  road,  and  the 
value  of  all  the  minerals  and  timber  contained, 
this  increase  should  be  estimated  at  double  or 
treble  the  above  figure.  To  be  conservative  we 
will  only  put  the  increase  at  twenty  dollars  per 
acre. 

Here  is  a  section  of  land,  five  thousand  by  one 
hundred  miles,  tributary  to  the  Great  Northern, 
and  in  this  territory  are  five  hundred  thousand 
square  miles  or  three  hundred  and  twenty  million 
acres.  Figure  that  this  has  increased  twenty  dol- 
lars per  acre  in  market  value,  since  the  advent  of 
the  road;  the  increase  would  then  amount  to  six 
billion  four  hundred  million  dollars  of  wealth, 
developed  in  the  country  by  the  untiring  work 
and  energy  of  James  J.  Hill. 


48  CONFIDENCE 

Estimate  that  Mr.  Hill  was  only  ten  years  in 
advance  of  others  in  creating  these  values,  and  we 
will  not  credit  all  the  development  to  him;  we  will 
only  credit  him  with  six  per  cent,  simple  interest 
on  these  created  values,  for  this  ten-year  period, — 
which  amounts  to  three  billion  eight  hundred  and 
forty  million  dollars.  Bear  in  mind  that  this  is 
just  the  interest  for  ten  years,  on  what  Hill 
created  in  property  and  land  values,  in  but  five 
thousand  of  the  seven  thousand  miles  of  trackage. 

If  you  earn  sixty  dollars  a  year  you  receive  the 
same  increase  as  does  a  man  investing  one  thou- 
sand dollars  at  six  per  cent.  Income  is  the  an- 
nual revenue  from  your  time  or  from  your  in- 
vested money. 

Consider  the  ^\ide  territory  awakened  by  the 
Great  Northern  Railroad;  the  mines,  cities, 
farms  and  ocean  commerce, — developed  by  Hill 
and  his  Great  Northern. 

At  least  five  hundred  thousand  people  found 
employment  at  good  wages,  by  reason  of  this  one 
man's  energy.  If  each  only  earns  two  dollars 
a  day,  this  is  increased  income  for  employed 
labor,  amounting  to  one  million  dollars  a  day ;  or 
for  three  hundred  days,  three  hundred  milKon 
dollars  annually.     This  is  six  per  cent,  interest 


OR    NATIONAL    SUICIDE?         49 

on  five  billion  dollars.  In  other  words,  through 
Hill's  work,  United  States  labor  was  able  to  earn 
as  much  additional  money  as  capital  could  earn 
by  the  sound  investment  of  five  billion  dollars. 

It  staggers  the  human  mind  to  think  that  one 
railroad,  built  by  one  man,  could  bring  such  help 
to  a  nation. 

Men  from  all  corners  of  Europe  swelled  the 
population  of  the  United  States;  they  emigrated 
from  Germany,  France,  Sweden,  Norway,  Eng- 
land, Austria;  brought  their  families,  earned 
good  wage, — spent  it  here! 

What  did  these  increased  earnings  of  labor  do 
for  our  wholesale  and  retail  trade?  They  secured 
better  returns  for  building  material  and  for  man- 
ufactured goods. 

Hill  increased  land  values  at  least  six  billion 
four  hundred  thousand  dollars  and  the  annual 
value  of  labor  three  hundred  million  dollars 
annually. 

I  have  noted  two  of  the  many  benefits  con- 
ferred by  the  Great  Northern;  increased  land 
values  and  increased  income  for  labor. 

The  third  benefit  is,  opportunity  offered  for  the 
safe  investment  of  foreign  and  domestic  capital 
in  new  industries. 


50  CONFIDENCE 

The  wealth  of  England,  France,  Holland  seeks 
investment  in  foreign  lands.  Their  territory  is 
fully  improved  and  therefore  their  idle  money 
must  find  investment  in  imdeveloped  countries. 
What  opportunities  the  vast  empire  of  the  Great 
Northern  offered  for  the  investment  of  foreign 
funds  in  the  United  States!  At  once  it  wit- 
nessed the  building  of  great  elevators  and  mills 
at  Minneapolis  and  St.  Paul;  the  opening  of 
gold,  silver,  and  copper  mines;  construction  of 
smelters,  electric  light  and  water  plants;  hun- 
dreds of  towns  sprang  up ;  the  cities  of  Spokane, 
Seattle,  and  Tacoma  were  built. 

These  creations  surely  may  be  valued  at  from 
six  to  ten  billions  of  dollars. 

Therefore  we  must  acknowledge  that  through 
Mr.  Hill's  construction  of  the  Great  Northern 
Railway,  the  Northwest  has  received  first ;  an  in- 
crease in  land  values  amounting  to  six  billion  four 
hundred  thousand  dollars;  second, — larger  an- 
nual payrolls  for  all  labor  along  Great  Northern 
territory,  three  hundred  million  dollars;  third, — 
investment  opportunities  in  that  region  for  six 
billion  dollars. 

If  we  suppose  that  the  total,  two  hundred  and 
ten  million  dollars  of  Great  Northern  stock  is 


OR    NATIONAL    SUICIDE?        51 

purely  water,  (which  it  assuredly  is  not),  is  it 
a  reward  any  too  great  for  the  venturous  stock- 
Iiolders  of  the  Hill  raih'oad? 

If  the  two  hundred  and  ten  million  dollars  of 
Great  Northern  stock  be  all  regarded  as  water, 
(or  increased  value),  its  par  value  is  less  than 
one-twenty-fifth  of  the  increased  values  (or 
water)  of  the  territory  served  by  the  road. 

Now,  on  what  side  of  the  fence  is  the  water, — • 
on  the  inside  or  the  outside? 

Is  it  possible  that  any  one  can  think  for  a  mo- 
ment that  the  Great  Northern  stockholders 
benefited,  comparably,  with  others  who  profited 
by  the  opening  up  of  this  region? 

Where  is  the  justice  in  forcing  a  man  like  Hill 
to  beg  for  fair  play  from  the  American  people  ? 

I  wish  to  ask  the  reader: — Are  you  perfectly 
willing  to  face  loss  of  business  and  money?  If 
so,  then,  perhaps,  you  may  witness  injustice  to 
the  railroads  with  equanimity. 

But,  if  you  desire  to  have  your  own  business 
prosper;  if  you  wish  to  see  our  land  develop,  dur- 
ing your  lifetime;  know  and  work  to  the  end  that 
the  railroads  shall  be  allowed  increased  traffic 
rates, — in  keeping  with  advances  along  all  other 
lines  of  commercial  enterprise  and  development 
in  the  United  States. 


52  CONFIDENCE 

Then  will  other  empire  builders  be  encour- 
aged to  follow  Hill's  example,  striving  for  the 
upbuilding  of  our  nation. 

Let  us  not  begrudge  builders  of  American  rail- 
roads commensurate  returns  from  their  invest- 
ments when,  in  ninety  cases  out  of  a  hundred, 
men  like  Hill,  have  made  twenty-five  times  as 
much  money  for  people  outride  the  right  of  way, 
than  has  been  made  for  the  inmle  stockholders! 


AMERICAN    WOLVES 


AMERICAN    WOLVES 

T?VERY  few  years  the  commerce  and  pros- 
23erity  of  our  comitry  have  been  forced  to 
pay  tribute  to  the  bear  leaders. 

Pirates  of  the  North  African  coast,  in  the 
fifties,  demanded  from  the  United  States  a  trib- 
ute so  small,  as  compared  to  the  demands  and  ex- 
actions of  these  bear  raiders,  that  it  makes  the 
African  pirates  of  old,  seem  meek  as  Sunday 
School  teachers.  In  each  bear  attack,  we  see 
some  leading  man  mangled  on  the  financial  rack. 
While  the  victim's  fingers  are  not  pulled  out,  as 
was  the  method  of  the  Spanish  inquisition;  and 
while  the  torture  chamber  is  not  now  in  some  dark 
dungeon,  but  in  beautifully  equipped  and  fur- 
nished offices,  the  torture  is  just  as  great. 

A  man  may  have  fair  financial  standing.  He 
perhaps  thinks  he  has  the  confidence  and  respect 
of  leading  interests.  He  imagines  he  may  escape 
the  cough-up-quick  methods  of  the  street.  No 
doubt  he  is  a  director  of  banks  or  trust  compa- 
nies. He  has  been  requested  to  carry  his  account 
in  this  or  that  bank  or  trust  company;  he  has  been 

55 


56  CONFIDENCE 

given  unlimited  credit  at  the  brokers ;  but  the  day 
comes  when  the  bears, — or,  in  truth,  wolves — 
"need  his  money";  these  wolves  may  have  been 
associated  with  him  and  he  thinks  they  will  play 
fair.  Like  Russian  wolves,  financial  raiders  do 
not  discriminate  while  picking  their  victims. 

The  time  comes  for  the  victim  to  disgorge  a 
million  or  two  because  he  believed  in  his  wolf- 
ish chums.  These  wolves  have  friends  in  many 
banks  and  can  find  out  just  where  his  loans  are, 
nearly  all  being  "on  demand."  In  twenty-four 
hours  they  size  up  what  bear  pressure  he  can 
stand;  they  know  his  assets,  almost  to  a  cent. 

The  play  begins.  They  sell  short,  three  or  four 
thousand  shares  of  his  favorite  stocks.  The 
banks  call  for  more  collateral  and  he  complies. 
Next,  three  or  four  thousand  shares  more  are 
dumped  on  the  market  and  the  man  they  are  after 
is  the  principal  supporter  of  these  stocks;  he  is 
now  on  the  run!  Therefore,  the  market  is  not 
protected  in  these  stocks.  Gossip  is  started  that 
Mr.  Victim  is  in  a  tight  place.  This  stops  all 
buying  of  his  favorite  stocks,  since  a  greater 
slump  is  feared  because  he  is  reported  weak.  Sud- 
denly more  shares  are  sold  at  a  five  point  drop. 
More  collateral  is  demanded  wliich  he  cannot  now 


OR    NATIONAL    SUICIDE?         57 

give,  and  this  is  known  at  once  at  the  seat  of  war. 
His  bank  loans  are  called;  cash  and  collateral 
gone, — excepting  a  package  of  "cats  and  dogs" 
that  the  bankers  will  not  accept.  One  more  raid 
on  prices;  a  little  more  bear  talk  and  the  victim, 
recognizing  the  pursuers,  disgorges  to  the  wolf- 
pack  anywhere  from  a  quarter  to  a  half  of  his 
life  savings.  Then  the  market  rebounds  and  the 
papers  mention  how  the  day  was  saved.  The  cur- 
tain falls! 

It  was  a  put-up  job  from  start  to  finish.  If  he 
had  been  a  big  fish,  a  panic  might  have  resulted 
affecting  all  interests.  Confidence  is  shaken! 
Millions  of  dollars  are  lost;  our  people  are  made 
to  suffer ;  business  is  retarded ;  and  we  are  damned 
in  the  eyes  of  the  world. 

Why  is  it  that  a  man,  on  the  slightest  provoca- 
tion, will  whoop  it  up  for  the  Stars  and  Stripes, 
singing: — "My  country,  'tis  of  thee,"  will  fight 
in  the  Spanish  War,  and  allow  his  son  to  join  the 
Society  for  the  Prevention  of  Cruelty  to  Ani- 
mals; will  contribute  to  the  Ice  Fund  and  other 
charities;  will  do  all  in  his  power,  (as  he  thinks) , 
for  humanity's  sake;  will  weep  great  tears  over 
the  Armenian  massacres ;  and  then,  forsaking  all 
good  promptings,  will  perversely  degenerate  to 


58  CONFIDENCE 

engineer  a  bear  raid?  Raiders  are  willing  to  at- 
tack a  great  American,  and  ruin  an  enterprise 
which  probably  represented  years  of  suffering 
and  labor  in  the  building.  The  money  wolf  may 
bring  down  in  the  wreck  a  bank  or  trust  company 
just  for  a  little  gold.  And  while  doing  this 
wrecking,  dares  to  think  he  is  a  patriot,  and  con- 
siders himself  a  Christian  or  an  orthodox  Jew, 
yet  feels  no  more  compunction  when  shooting 
holes  in  the  ten  commandments  than  he  experi- 
ences while  smashing  clay  pigeons. 

What  is  the  good  of  money  secured  in  tliis  way 
and  who  can  be  sodden  enough  to  want  it  ? 

A  man  once  prominent  in  business  and  whose 
name  was  daily  in  the  papers,  a  few  years  ago 
made  the  remark  to  me: — "I  am  out  for  the  stuff 
and  I  will  get  it  some  way — any  way;  people 
know  that  is  mj*  game,  but  I  am  the  smarter  and 
will  win." 

I  have  watched  that  man  and  it  is  true  that  he 
has  won  money,  but  he  has  no  friendly  associates. 
It  is  true  that  he  has  a  brilliant  mind,  yet  he  has 
not  won  a  respected  position  in  the  business 
world.  He  can  secure  all  that  money  can  buy ;  he 
can  weigh  out  his  gold  for  lands,  pictures,  houses 
and  automobiles,  but  he  cannot  purchase  desira- 


OR    NATIONAL    SUICIDE?         59 

ble  friends ;  he  cannot  buy  respectable  standing  in 
the  business  world.  If  his  name  were  now  con- 
nected with  any  great  business  enterprise  it  would 
damn  it  from  the  start. 

I  wonder  if  he  realizes,  as  the  shadows  of  the 
great  unknown  sweep  over  him,  that  he  cannot 
push  them  back;  that  he  will  soon  be  swept  into 
the  great  hereafter,  for  which  he  cared  so  little  in 
the  years  gone  by.  When  he  is  alone  in  the  twi- 
light of  his  earthly  life,  and  sees  the  night  ap- 
proacliing,  will  all  his  millions  take  the  vile  taste 
from  his  mouth,  when  he  thinks  of  the  nasty  tricks 
which  won  the  gold?  Then,  surely,  he  would 
gladly  give  half  of  all  his  possessions  in  ex- 
change for  his  sacrificed  character  and  manhood. 


"GRABITIS" 


"GRABITIS" 

/^NE  of  the  greatest  faults  of  the  American 
^^  people  may  be  termed,  for  want  of  a  better 
word,  "Grabitis,"  meaning  that  trait  of  grabbing, 
the  "grab  disease,"  wliich  has  of  late  had  full 
sway  in  the  United  States. 

It  is  grab,  grab  all  the  time  until  death  calls 
the  game.  Suppose  you  do  accumulate  one  hun- 
dred and  sixty  million  dollars,  or  sixteen  million 
dollars,  or  even  six  hundred  thousand  dollars.  Is 
this  not  enough  to  take  the  energy  out  of  any 
young  man  who  inherits  it? 

While  you  were  accumulating  this  wealth  in 
what  a  mad  rush  you  were  living!  What  pleas- 
ure did  you  get  out  of  life?  Your  family  and 
children  obtained  only  a  cinemetographic  view  of 
you;  with  your  clubs,  your  meetings,  your  wife 
had  only  a  hazy  idea  that  she  had  a  husband,  and 
by  keeping  a  photograph  of  you  in  each  room, 
retained  a  fairly  accurate  idea  of  your  appear- 
ance. 

You  acquired  the  C.  &  F.  Railroad;  then  you 
bought  the  majority  of  the  stock  of  the  L.  F. 


64  CONFIDENCE 

&  W.  and  froze  out  a  minority  of  the  stockhold- 
ers, by  passing  the  dividends  and  pretending  that 
you  were  upbuilding  the  road ;  at  last  you  forced 
them  out,  or  nearly,  for  a  small  price.  When  your 
squeeze  was  finished,  you  started  dividends  by  a 
well-arranged  pool,  pushed  the  stock  up  to  near- 
ly par,  from  about  forty ;  tliis  made  for  you  per- 
haps four  miUion  dollars,  which  was  one-half  fair 
business  deahngs,  and  half,  plain  highway  rob- 
bery. Perhaps  it  is  not  just  to  cast  such  a  slur 
on  the  highway  robbers ;  they  were  brave  men  and 
took  their  lives  in  their  hands;  you  were  a  sneak 
and  sandbagged  the  minority  in  a  way  they  could 
not  resent.  But  this  four  million  dollars  enabled 
you  to  buy  a  large  interest  in  the  P.  M.  &  F. 
Railroad ;  you  are  elected  on  the  directorate ;  why 
in  thunder  you  wanted  this,  God  only  knows !  but 
the  "Grabitis"  possessed  you  and  you  grabbed. 
By  this  time  you  were  elected  to  boards  of  twenty 
bank  and  trust  companies,  not  for  the  benefit  that 
you  conferred  upon  the  stockholders,  but  because 
you  thought  that,  as  a  director,  you  could  borrow 
more  with  less  chance  of  being  "called"  in  case 
you  got  into  a  hole.  You  soon  were  director  in 
such  a  lot  of  banks  and  trust  companies  that  you 
needed  a  secretary  to  tell  you  when  the  meetings 


OR   NATIONAL    SUICIDE?        65 

occurred,  and  you  nearly  required  roller  skates 
on  which  to  glide  around  from  one  meeting  to  an- 
other, in  time  to  pocket  the  ten  or  twenty  dollar 
fees.  By  coming  in  late,  you  attracted  attention 
and  it  appeared  to  your  fellow  directors  that  you 
were  in  demand,  and  that  it  was  an  honor  for 
them  to  be  on  the  same  boards  with  you.  Every 
time  there  was  a  money  squeeze  you  were  just 
two  points  ahead  of  "a  fit,"  since  your  assets 
were  spread  out  thin  as  molasses  in  fly  time. 

Doubtless  you  worked  hard  and  now  and  then 
had  to  take  a  cocktail  and  a  few  whiskeys  to  keep 
up  the  pace,  but  you  had  "grabitis"  and  you 
could  not  stop  to  rest ;  you  were  a  human  steam- 
roller, and  like  adverse  Fate,  crushed  those  in 
your  path.  Then  came  a  year  when  things  looked 
blue;  you  took  a  house  at  Newport  for  the  sea- 
son, in  order  to  bluff  your  banks,  and  you  rushed 
through  the  year,  not  once  breaking  a  cog  of  the 
wheel  of  your  plans. 

Next,  stocks  were  depressed!  You  tried  to 
grab  one  more  railroad,  but  someone  with  a 
"grabitis"  case  eclipsing  yours,  got  ahead  of  you; 
it  worried  you ;  you  felt  the  loss  of  prestige ;  you 
slept  poorly;  took  more  whiskey  and  soda,  etc. 
Soon  there  came  a  day  when  a  string  in  your 


66  CONFIDENCE 

makeup  snapped ;  you  staid  around  the  house  and 
sent  word  that  you  were  feeling  fine,  but  would 
take  a  month  or  two  of  rest;  in  a  week  or  so  all 
the  strings  were  snapping  and  it  was  all  over. 

In  twenty  years  not  a  person  on  earth  except- 
ing son  or  daughter  will  ever  know  that  you  ex- 
isted; they  will  now  and  then  point  to  your 
picture  and  say  "That  was  father — he  was  a  won- 
der in  his  day!" 

Is  it  worth  it  ?  You  were  merely  a  human  cash 
register;  just  a  machine  in  which  to  drop  dollars 
to  be  added  up  correctly. 


ARE  YOU  A  LION  OR  A  ZEBRA? 


ARE  YOU  A  LION  OR  A  ZEBRA? 

n  ECENTLY,  while  reading  Ex-President 
Roosevelt's  vivid  description  of  an  African 
plain,  alive  with  wild  animals, — zebras,  giraffes, 
wild  cats,  and  lions, — to  me  it  seemed  a  picture 
of  human  Hfe.  Side  by  side  were  animals  which 
live  only  by  devouring  each  other  (like  the  lion, 
the  panther,  and  the  wild  cat) ,  while  near-by,  the 
zebra  grazed,  and  the  stately  giraffe  ate  young 
fohage,  and  I  could  not  but  think  this  picture 
represented  men  of  the  financial  world. 

In  this  country  there  are  men  who  are  creating, 
building  up,  making  two  blades  of  grass  grow 
where  before  was  only  one;  using  only  clean 
methods,  seeing  visions  of  the  blessings  their 
work  will  confer  on  man,  and  content  with  the 
thought  that  if  they  reap  no  financial  benefit, 
there  is  a  reward  which  comes  alone  from  pure 
living;  and  an  appreciation  that  money  is  not  the 
greatest  thing  in  the  world.  These  men  may  be 
likened  to  zebras  and  giraffes, — living  on  grass 
and  leaves,  and  harming  none.  Again  there  are 
men  who  may  be  likened  unto  carnivorous  ani- 


70  CONFIDENCE 

mals,  hungrily  waiting  to  find  a  man  weak 
enough  for  them  to  fall  upon  and  devour.  Such 
men  live  only  that  they  may  destroy  the  weak, 
and  they  call  it  "business,"  and  use  phrases  such 
as  "we  will  twist  his  tail,"  "we  have  him  on  the 
run,"  and  "we  will  freeze  him  out  in  less  than  a 
year."  Tricks,  deceits,  slander,  are  their  favorite 
weapons,  and  how  they  remind  one  of  the  panther, 
silently  stalking  prey,  surprising  and  destroying 
his  victim! 

I  am  reminded  of  a  man  who  came  into  my 
office,  with  a  scheme  to  force  to  the  wall  two 
electric  light  plants  of  a  small  town.  He  began 
by  asking  if  I  wanted  to  be  let  in  on  a  good  deal. 
I  said:— "Go  ahead!" 

It  seemed  that  a  certain  western  man  owned 
one  of  these  electric  plants,  but  the  company  had 
never  been  a  financial  success.  A  rival  had  cut 
prices;  competition  was  too  great!  He  was  "ex- 
tended," and  had  loans  at  two  local  banks,  only 
keeping  up  the  interest.  The  bankers  respected 
the  man,  for  he  was  one  of  the  leading  men,  who 
for  years  had  fought  against  adverse  circum- 
stances, and  would  not  "force  him  to  the  wall." 
They  were  willing  to  sell  his  paper  to  others,  for 
banks  had  been  warned  by  the  Comptroller  to  get 


OR    NATIONAL    SUICIDE?        71 

rid  of  it  as  soon  as  possible.  My  visitor  knew  the 
total  of  the  debts,  and  what  it  would  cost  to  buy 
them.  The  rival  plant  was  owned  by  nearly  a 
hundred  bond  and  share  holders,  "half  of  them 
women,"  he  said,  "who  did  not  know  anything 
about  business!"  The  plant  in  question  had  more 
modern  macliinery,  and  cost  less  than  the  other, 
he  continued,  but  at  the  rates  prevailing,  could 
pay  only  the  interest  and  not  keep  up  the  plant. 
]My  visitor's  scheme  was  to  buy  from  the  bank 
the  paper  of  this  man  who  owned  the  first  plant; 
sell  him  out;  get  a  judgment;  and  then,  he  said, 
this  would  give  us  the  plant,  and  a  judgment  for 
$100,000.  The  man  would  have  to  sacrifice  liis 
home,  which  would  make  him  a  pauper!  Then, 
with  this  acquired,  we  could  reduce  electric  light 
rates  one-half,  and  figure  on  intentionally  drop- 
ping twenty-five  thousand  dollars  during  the 
year.  This  would  mean,  he  said,  "quick  death  to 
the  other  plant";  it  would  "force  them  to  the 
wall,"  and  we  could  buy  them  out  at  foreclosure 
sale  for  half,  since,  he  said,  "the  old  women 
would  not  know  how  to  protect  themselves!" 
We  might  then  consolidate  the  two  plants;  he 
could  push  a  franchise  through  the  Council  for 
fifteen  thousand  dollars ;  then  we  could  put  up  the 


72  CONFIDENCE 

rates  and  make  five  hundred  thousand  dollars  by 
this  fine  deal. 

I  listened  to  his  scheme  of  highway  robbery, 
and  as  he  mentioned  the  possible  profit,  I  could 
imagine  the  saliva  foaming  at  his  mouth;  like  a 
caged  lion  viewing  the  keeper  offering  a  chunk 
of  meat  dripping  with  red  blood ! 

If  there  is  anything  in  the  Asian  creed  of  re- 
incarnation it  would  seem  my  visitor,  centuries 
past,  must  have  been  a  pirate  at  "the  top  of  his 
trade,"  and  I  fancied  him  then,  red-shirted  and 
with  knife  in  teeth,  climbing  over  the  poop  deck 
of  some  brig  he  hoped  to  scuttle. 

After  my  tempter  finished  his  offering,  I  said : 
"Where  does  the  man  live,  whom  we  are  to  put 
out  of  the  way?"  He  answered: — "In  a  fine 
house  on  one  of  the  leading  avenues."  I  asked : — 
"Is  the  street  well-lighted  and  policed?"  He  did 
not  know,  and  looked  puzzled. 

I  enquired: — "Is  this  man  all  that  we  have 
standing  in  our  way?" 

He  replied:— "Yes!" 

Then  I  said: — "I  hate  to  torture  him,  and  take 
his  all.  It  will  be  better  to  kill  him,  and  put  him 
out  of  his  misery.  If  consulted  he  would  prefer 
this,  for  I'm  sure  his  has  been  a  hard  struggle. 


OR    NATIONAL    SUICIDE?         73 

What's  the  matter  with  our  breaking  into  his 
house,  and  smashing  him  over  the  head  with  a 
sandbag?  It  will  be  quicker,  and  he  will  not 
suffer  so  much,  as  by  your  plan." 

I  never  will  forget  the  expression  on  his  face 
as  he  rushed  out,  not  understanding  why  I  was 
such  a  lunatic  as  to  turn  down  his  offer,  but  it  did 
not  appeal  to  me.  I  was  a  zebra,  and  lived  on 
grass. 


OUR    FINANCIAL    APACHES 


OUR  FINANCIAL  APACHES 

'T^HE  following  articles  from  French  journals 
show  the  feeling  in  that  repubUc,  (which 
saves  and  invests  more  millions  than  any  nation 
of  its  size,)  regarding  American  financial 
methods. 

"Les  Temjis,"  leading  journal  of  France,  says: 
"What  would  be  the  effect  if  our  markets  were 
officially  open  to  leading  American  securities? 
What  would  have  been  the  result  to  French  in- 
vestors if  the  effort  to  introduce  Steel  Common 
on  the  Paris  Bourse  had  succeeded?  In  one  year 
tliis  security  has  dropped  from  ninety-five  to 
sixty-two.  The  less  that  we  have  to  do  with 
American  finance,  as  far  as  speculative  securities 
are  concerned,  the  greater  will  be  our  chance  for 
escaping  its  fatal  influence.  We  are  not  strong 
enough  to  meet  such  unscrupulous  gamblers, 
whose  ideas  of  business  morality  are  totally  dif- 
ferent from  ours,  and  who  regard  the  pursuit  of 
other  people's  money  as  the  noblest  existing 
sport." 

"Le  Journal  des  Debats,"  Paris,  a  very  con- 

77 


78  CONFIDENCE 

servative  paper,  says:  "People  are  asking  them- 
selves whether  Americans  are  not  displaying 
foolishness,  as  usual,  in  continuing  their  financial 
machinations, — in  their  fondness  for  strangling 
competition, — which  is  likely  to  furnish  weapons 
against  the  trusts.  It  must  also  be  admitted  that 
the  spectacle  of  their  combats,  in  which  the  un- 
fortunate shareholders  receive  the  worst  blows 
struck  by  the  belligerents,  is  not  calculated  to 
favor  the  admission  of  American  securities  on  the 
markets  of  Europe." 

You  may  read  in  other  French  papers  that  our 
brilliant  lights  in  the  financial  world  really  are 
"Apaches." 

The  appearance  of  such  articles  in  leading  for- 
eign papers  does  not  tend  to  make  the  placing  of 
American  bonds  and  shares  an  easy  matter,  and 
sales  of  one  hundred  and  thirty  milHon  dollars 
of  our  bonds  were  cancelled  in  France,  I  under- 
stand, during  last  June  and  July.  If  an  ad- 
vance in  railroad  rates  were  allowed,  and  no 
injunction  granted,  these  proposed  sales  would 
have  been  made.  The  granting  of  the  injunc- 
tion not  only  worked  to  prevent  these  sales,  but 
was  used  in  that  masterly  way  which  Wall  Street 
understands, — that  the  slightest  suspicion  regard- 


OR    NATIONAL    SUICIDE?        79 

ing  the  future  trend  of  the  market  should  force 
the  seUing  of  stocks. 

Wall  Street  knows  well  that  the  rapid  falling 
of  values  weakens  bonds  and  shares  all  over  the 
United  States.  The  public  thinks  something 
panicky  is  going  to  happen;  it  knows  not  what, 
so  shares  are  immediately  dumped  on  the  market. 

Those  who  engineer  bear  raids  fully  under- 
stand the  solid  worth  of  United  States  Steel ;  they 
understand  that  it,  if  any  stock,  is  worth  par; 
that  it  has  earned  on  the  common  stock  eight  per 
cent,  per  annum,  since  incorporation.  Wall 
Street  did  all  in  its  power  to  pubhsh  these  im- 
portant facts  when  the  stock  was  distributed  at 
high  prices.  Now,  it  wants  it  back,  and  the 
poor  investor,  who  was  ten  years  screwing  up  his 
courage  to  buy  it,  now  drops  Steel,  pocketing  a 
loss,  and  goes  back  to  the  wood  pile  to  saw  more 
wood. 

He  had  the  money  to  invest,  and  advisedly 
bought  Steel  stock,  but  the  rapid  fall  in  quota- 
tions took  his  breath  away;  he  could  not  stand 
seeing  his  money  melt,  and  sacrificed  it.  His 
stock  was  a  safe  and  sound  investment,  in  a  strong 
company  with  splendid  management,  and  most 
promising  future.    I  consider  the  creation  of  the 


80  CONFIDENCE 

United  States  Steel  Corporation  as  the  master- 
piece of  J.  P.  Morgan's  life.  Its  reserves  of  coal 
and  ore  alone  will  make  its  stock  some  day  worth 
two  hundred  dollars  per  share;  and  its  foresight 
in  building  the  new  plant  at  Gary,  Indiana, 
makes  it  an  ideal  investment. 

Its  future  is  bright  as  that  of  the  United 
States.  But  its  value  must  be  made  to  fall  from 
ninety-five  to  sixty-four,  not  from  any  weakness 
of  the  company,  not  from  lack  of  promise. 

A  score  of  raiders,  understanding  human  na- 
ture, its  fears  and  moods,  play  with  investors, 
and  at  will  make  the  financial  refrain  one  of  sor- 
row or  joy.  The  market  falls  or  rises  at  their 
will,  and  no  organist  more  completely  masters  his 
instrument,  than  does  this  lot  of  raiders,  working 
all  stops  of  the  organ  of  speculation.  Their 
power  to  exact  the  pound  of  flesh,  would  make  a 
pawnbroker  green  with  envy,  and  induce  Captain 
Kidd  to  turn  over  in  his  grave, — wishing  that  he 
was  now  on  earth,  to  join  the  piratical  crew. 

French  journals  dub  such  raiders  "Apaches"! 
Since  we  have  captured  the  Apache  Indians  of 
Arizona,  and  removed  them  to  a  Florida  reserva- 
tion, why  not  capture  the  Apaches  of  New  York, 
and  put  them  also  in  limbo?    Western  Apaches 


OR    NATIONAL    SUICIDE?         81 

in  sixty  days  never  destroyed  values  of  hundreds 
of  millions ;  they  burned  a  few  farm  houses  occa- 
sionally ;  yet  our  government  pursued  and  wiped 
them  out. 

When  abroad,  it  makes  one's  blood  boil  to  hear 
his  countrymen  so  characterized;  for  you  know 
that  business  morals  of  average  members  of  the 
New  York  Stock  Exchange  will  compare  favor- 
ably with  those  of  the  members  of  any  exchange 
in  the  world. 

It  disgusts  you  to  see  your  countrymen  severely 
criticised, — knowing  that  a  handful  of  skillful 
and  unscrupulous  raiders  create  this  national  dis- 
repute. It  was  an  awful  mistake  that  raiders 
were  freely  furnished  with  weapons  for  their  at- 
tacks on  values  and  credits.  Their  weapons  were 
shaped  from  the  fact  that  railroads  were  not  al- 
lowed advanced  rates  permitting  them  to  share 
in  general  prosperity,  experienced  by  all  other 
hues  of  American  trade  and  commerce. 


STATE    CONTRACTS 


STATE    CONTRACTS 

TT  is  a  fact  which  few  business  men  or  labor 
■^  leaders  understand,  that  there  can  be  no  pros- 
perity in  the  United  States,  if  the  railroads  are 
not  successful.  Liberal  traffic  rates  will  make  the 
nation  prosper.  The  railroad  is  the  mainspring 
of  the  nation's  business.  Hundreds  of  thousands 
of  railroad  emploj^ees  distribute  thousands  of 
millions  of  dollars  to  merchants  and  manufac- 
turers,— annually. 

Contrary  to  public  opinion,  when  traffic  rates 
are  reduced  and  railroads  starved,  the  people  can- 
not prosper  and  all  industries  languish. 

You  may  not  have  a  bond  or  a  share  in  any 
railroad ;  you  may  never  know  any  one  who  ever 
owned  a  bond  or  a  share ;  you  may  live  in  a  small 
town  where  no  one  ever  invested  in  railroad  bonds 
or  shares ;  you  may  applaud  when  some  politician 
vociferates  that  he  will  force  railroads  to  reduce 
rates,  and  you  think  that  this  politician  is  a 
friend  of  the  people. 

Let  me  illustrate  how  remote  conditions  affect 
us  I    In  1903  a  young  man  seeking  a  bookkeeper's 

85 


86  CONFIDENCE 

position  came  into  my  office.  I  rather  liked  his 
looks,  and  asked  him  how  he  had  lost  his  last 
place,  recalling  that  he  had  been  bookkeeper  for 
a  Topeka  Water  Company.  He  said :  "By  rea- 
son of  the  great  crop  failure  of  1900  in  Argen- 
tine." I  replied:  "How  in  Heaven's  name  could 
the  crop  failure  in  Argentine  force  you  out  of  a 
position  in  Topeka?"  The  answer  was:  "The 
Barings  were  large  stockholders  in  the  Topeka 
Water  Company;  the  crop  failure  in  the  Argen- 
tine caused  the  Barings  to  fail,  and  the  Superin- 
tendent of  the  Water  Works  thought  it  would 
please  the  owners  if  expenses  were  reduced,  so 
he  let  out  five  of  the  employees."  This  will  serve 
to  illustrate  how  remote  causes  affect  people  at 
long  range. 

Now  we  will  see  that  starvation  of  the  railroads 
affects  merchants  in  far  distant  towns. 

First,  there  is  no  way  in  which  any  three  im- 
portant railroads  in  the  United  States  may  be 
forced  into  receiver's  hands,  without  bringing 
panic.  Even  the  suggestion  of  such  a  possibility 
has  created  great  fear  all  over  the  country. 

Start  fear  in  the  minds  of  men,  and  all  busi- 
ness is  restricted;  the  New  York  banks  call  in 
their  loans;  then  the  Chicago  banks  do  likewise. 


OR   NATIONAL    SUICIDE?        87 

This  fear  ^\ddens  until  it  reaches  the  far  town,  in 
which  lives  a  man  who  "damns"  the  railroads.  He 
goes  to  the  bank  for  a  loan,  or  he  is  a  stockholder 
in  the  bank,  and  cannot  sell  the  stock,  for  a  few 
banks  have  just  failed,  and  no  one  wants  stock  in 
banks  during  panicky  times.  He  is,  perhaps,  in 
pressing  need  of  money,  and  cannot  raise  it,  for 
confidence  in  the  railroads  has  been  destroyed; 
his  banker  is  full  of  fear,  and  refuses  to  make  any 
more  loans ;  in  fact,  all  the  United  States  is  filled 
with  fear,  and  business  is  restricted. 

Stagnation  for  invested  capital  spells  stagna- 
tion for  all  business.  The  value  of  bonds  and 
shares  has  depreciated,  millions  upon  millions. 
Every  business  man  feels  the  squeeze;  manufac- 
turers shorten  the  hours  of  labor. 

Some  person  in  power,  thinking  that  he  is  com- 
plying with  the  wishes  of  the  people  (and  per- 
haps the  wish  of  the  President  of  the  United 
States),  suggests  restraining  action  which  will 
reduce  railroad  revenues;  the  bear  raiders  imme- 
diately exaggerate  the  idea  to  suit  their  harmful 
purpose;  and  all  the  wheels  of  progress  begin  to 
slow  down. 

Everyone  in  the  United  States  feels  the  evil 
effects.    Yet,  at  the  very  same  time  many  people 


88  CONFIDENCE 

and  journals  are  applauding  a  political  idea  or 
bill  which  means  death  to  business  for  the  next 
twelve  months. 

This  will  some  day  be  understood,  and  then  no 
politician  will  dare  to  attempt  to  interfere  with 
American  railroads, — the  life  of  American  busi- 
ness and  prosperity ! 

While  considering  this  subject,  I  wish  to  com- 
mend the  safety  of  railroad  investments  in  Mex- 
ico, and  the  different  methods  there  employed  to 
safeguard  them.  If  you  make  up  your  mind  to 
build  a  railroad  in  Mexico,  you  go  to  the  Govern- 
ment, and  it  gives  you  a  concession  for  ninety- 
nine  years.  In  that  concession,  the  Government 
states  the  maximum  rates  which  you  may  charge 
for  freight  and  passenger  business  for  ninety- 
nine  years.  You  understand  at  once  what  charges 
are  possible,  and  you  figure  out  whether  it  is 
enough  to  warrant  building  your  road.  You 
know  that  the  Mexican  Government  will  not 
hereafter  interfere  with  these  stable  traffic  rates. 

The  effect  of  a  railroad  commission,  acting  as 
operators  of  a  railroad,  forcing  high  officials  to 
do  office-boy's  work,  is  not  fair  or  helpful. 
Doubtless,  the  Railroad  Commissioner  has  no 
money  invested  in  the  Railroad  construction  or 


OR    NATIONAL    SUICIDE?         89 

operation.    Perhaps  no  resident  in  the  State  has 
such  interest. 

The  State  does  not  guarantee  that  the  traffic 
rates  made  by  the  Commissioners  will  even  pay- 
one  per  cent,  on  the  railroad  investment. 

But,  if  the  State  would  grant  a  railroad  a  fixed 
maximum  traffic  rate,  to  be  in  effect  for  thirty 
years,  then  the  Commissioner  and  the  State 
would  be  acting  fairly  and  justly.  The  railroad 
could  then  make  contracts  and  live  up  to  them. 

It  is  eminently  unfair  that  railroad  officials 
shall  be  forced  to  turn  over  the  conduct  of  their 
business  to  men,  or  commissioners,  or  States, 
which,  while  making  traffic  rates,  assume  no  re- 
sponsibility for  securing  just  returns,  or  fair  in- 
terest on  money  invested. 

Suppose  that  jewelry  shops  were  directed  and 
run  by  a  Railroad  or  similar  Commission.  Tif- 
fany builds  and  stocks  a  great  store,  and  when  its 
doors  are  open  for  trade,  he  is  compelled  to  turn 
it  over  to  a  State  Railroad  Commission.  He  is 
allowed  a  desk  in  his  store,  and  the  Commission 
proceeds  to  fix  prices  on  watches  and  rings. 

But  the  Commission  was  put  in  power  by  the 
people,  and  must  serve  the  dear  people.  Poor 
Tiffany  has  nothing  to  say.     The  Commission 


90  CONFIDENCE 

names  the  hour  for  opening  and  closing  the  store 
— which  must  close  on  Saturday.  But  the  em- 
ployees' wages  are  paid  with  Tiffany's  money! 

The  Commission  marks  thirty-dollar  watches 
down  to  twenty,  because  the  voters  who  elected 
the  Commission  need  cheap  watches, — at  less 
than  cost;  but  never  mind,  it's  Tiffany's  money, 
and  he  must  profit  by  other  sales. 

So  long  as  railroads  are  forced  to  transport 
live  stock  at  less  than  cost,  it  is  just  as  fair  that 
the  watches  be  sold  at  less  than  cost!  The  Com- 
mission so  argues,  because  it  is  given  power  to 
act,  not  by  Tiffany,  but  by  the  people,  and  the 
sacred  trust  must  be  executed  as  the  people  wish. 
Quite  right  is  the  Commission  to  exercise  its 
authority ! 

I  suggest  that  if  States  gave  to  new  railroads 
thirty-year  traffic  contracts  (as  does  Mexico), 
setting  forth  exactly  what  traffic  charges  may  be 
made,  capital  would  know  what  could  be  rehed 
upon  as  to  earnings  on  each  classification  of 
freight  and  passenger  service. 

No  other  business  could  stand  the  changeable 
conditions  now  imposed  upon  railroads. 

If  a  state  allows  its  cities  authority  to  grant 
thirty-year  franchises  to  street  cars,  with  fixed 


OR    NATIONAL    SUICIDE?        91 

rates  (these  are  also  accorded  to  electric  light  and 
power  plants),  why  is  it  not  considered  fair  that 
railways  may  also  contract  for  fixed  rates,  before 
beginning  their  construction  in  a  State  ? 

If  capital  would  refuse  to  build  more  railroads 
until  fixed  rates  are  established  by  law,  following 
the  examples  set  by  gas  and  electric  companies, 
and  street  car  lines,  the  various  states  would  soon 
meet  the  required  conditions. 

I  have  built  a  great  many  miles  of  railroad  in 
the  eastern  part  of  Texas.  I  built  the  Kansas 
City  Southern;  I  founded  one  of  its  sea-ports, 
Port  Arthur.  I  built  the  Port  Arthur  ship  canal, 
and  am  interested  now  in  building  the  Kansas 
City,  Mexico  and  Orient  railroad  in  the  western 
part  of  Texas,  together  with  large  irrigation 
works. 

So  it  can  be  said  that  I  am  a  friend  of  Texas. 
And  why  not?  It  is  an  empire  in  itself,  and  no 
one  can  foretell  its  future. 

Texas  leads  every  state  in  our  Union  as  to 
value  of  agricultural  products.  It  needs  rail- 
roads. 

Capital  does  not  now  think  Texas  friendly  to 
railroads,  and  the  feeling  may  not  easily  be  over- 
come.   It  would  be  well  for  Texas  to  adopt  the 


92  CONFIDENCE 

Mexican  plan,  and  make  contracts  with  the  rail- 
roads, with  fixed  rates;  not,  as  does  Mexico,  for 
ninety-nine  years,  but,  perhaps,  for  thirty  years. 
Should  the  State  make  fair  terms,  Texas  would 
experience  a  boom  in  railroad  building  which 
would  there  advance  the  hands  of  time  for  ten 
years,  create  new  cities,  and  bring  in  millions  and 
millions  of  added  wealth.  The  statesman  who 
should  inaugurate  this  policy  would  become  in  the 
minds  of  the  residents,  more  helpful  than  any 
man  who  ever  lived  in  the  Lone  Star  land. 

Of  tremendous  aid  in  developing  Texas  was 
the  building  by  B.  F.  Yoakum  of  the  St.  Louis, 
Brownsville  and  Mexican  Railway,  opening  the 
Southern  Gulf  Coast  region,  and  bringing  mil- 
lions of  dollars  within  her  borders. 

If  Texas  would  grant  existing  railroads  better 
rates,  this  would  bring  great  good  to  the  State. 
I  know  that  Texas  traffic  rates  are  too  low,  and  a 
slight  advance  would  attract  millions  to  Texas, 
and  secure  the  building  of  new  railroads. 

As  these  observations  are  made,  the  Dallas 
"News"  comes  to  me,  and  contains  an  extract 
from  a  speech  by  the  Honorable  Oscar  B.  Col- 
quitt, Democratic  nominee  for  the  Governorship 
of  Texas. 


OR   NATIONAL    SUICIDE?        93 

This  conveys  hope  that  Texas  is  awakening  to 
beckoning  Opportunity.  I  long  to  see  Texas, — 
largest  state  and  richest  as  to  wealth  of  varied 
natural  resources, — win  the  possible  rank  of  first 
American  commonwealth  as  to  population,  since 
she  now  stands  first  in  our  Union  as  to  agricul- 
tural production. 

Texas  has  but  to  give  fairer  rates  to  existing 
and  new  railroads  to  become  the  ranking  state  as 
to  population,  and  political  power  and  wealth. 
Long  have  I  labored  to  upbuild  Texas,  and  I 
fully  appreciate  her  needs  and  wonderful 
resources. 

Mr.  Colquitt  gives  me  great  hope.  All  the 
country  should  hear  his  recent  utterances:  "My 
message  to  the  legislature  will  recommend  no 
statute  that  will  frighten  any  capital,  or  jeopard- 
ize investment  of  honest  money!  Let  us  have 
no  more  radicahsm,  because  Texas  has  enough  to 
rest  on  for  a  season  1" 

Indeed,  these  are  tidings  of  joy! 

Most  people  understand  that  you  cannot  put 
an  eight-inch  stream  of  water  through  a  two-inch 
pipe.  It  is  estimated  that  the  United  States  has 
grown  fifteen  million  in  population  during  the 
last  ten  years,  and  in  the  next  ten  years  the 


94  CONFIDENCE 

growth  will  no  doubt  be  twenty  million,  about 
twenty-five  per  cent,  increase,  in  a  decade. 

Under  existing  conditions,  there  is  no  way  in 
which  money  can  be  found  for  railroad  develop- 
ment in  order  to  keep  step  with  this  increase. 
Yet,  railroad  building  must  keep  pace  with  the 
growth  of  population,  or  we  will  be  attempting  to 
put  an  eight-inch  stream  through  a  two-inch  pipe. 
Some  day,  an  awakening  to  the  sense  of  lost  op- 
portunities will  be  rude  and  severe ! 

The  last  nine  years  of  financial  unrest  in  the 
railroad  world;  the  depressions  of  1903,  1907  and 
1908;  advanced  costs  of  material  and  labor; — 
have  so  combined  to  threaten  the  railroad  builder, 
that  he  has  rested  on  anything  but  a  bed  of  roses. 


THE  CORPORATION  COURT 


THE  CORPORATION  COURT 

'T^ HANKS  to  President  Taft  we  now  have  a 
Commerce  Court,  which  will  aid  railroads 
by  securing  early  hearings. 

I  beheve  that  the  estabhshment  of  another  most 
useful  tribunal,  a  Corporation  Court,  would  be 
generally  welcomed. 

Oui'  nation  is  now  nearly  paralyzed,  while 
awaiting  the  Supreme  Court's  decision  in  the 
Standard  Oil  and  American  Tobacco  Company 
cases,  and  until  these  judgments  are  handed 
down  there  will  be  no  great  prosperity. 

Of  late,  we  have  been  told, — and  it  has  ap- 
peared in  the  Enghsh  journals, — that  legal  steps 
will  be  taken  against  the  United  States  Steel  Cor- 
poration for  being  a  monopoHstic  trust. 

Like  reports  are  heard  abroad  and  appear  in 
foreign  journals  every  time  there  is  an  American 
bear  raid.  Investors  have  felt  "jumpy"  of  late, 
frightened  by  stories  of  legal  procedures  and 
panics,  and  these  have  sorely  affected  values. 

The  United  States  Steel  Corporation  is  one  of 
the  best  organized  companies  in  the  world.     It 

97 


98  CONFIDENCE 

has  great  assets,  but  it  is  not  a  monopoly  and  does 
not  intend  to  become  such.  I  believe  that  the 
desire  of  its  directors  is  fully  to  comply  with  the 
law. 

I  beheve  there  is  no  truth  in  these  published 
reports.  But  there  seems  to  be  no  way  in  which 
they  may  be  conclusively  denied.  The  Steel  Com- 
pany cannot  well  do  this,  and  the  Government 
has  not  manifested  any  intention  of  so  doing. 

I  believe  the  Standard  Oil  Company,  and  the 
American  Tobacco  Company,  if  they  really  un- 
derstood the  law,  (which  nobody  seems  to  do), 
would  at  once  shape  their  course  to  comply  with 
its  every  letter. 

It  is  not  the  purport  of  these  remarks  to  discuss 
what  above  companies'  attempts  and  acts  have 
been,  in  the  past,  but  I  fully  believe  that  they  now 
desire  strictly  to  abide  by  the  law. 

A  general  state  of  uncertainty,  during  the  next 
few  months,  will  cost  the  United  States  untold 
millions  by  retarding  progress  and  restricting  our 
own  and  foreign  investments. 

If,  however,  we  had  a  Corporation  Court  com- 
posed of  six  eminent  attorneys,  before  which  any 
company  could,  in  advance,  state  its  business 
plans  for  the  court's  approval;  the  court's  legal 


OR    NATIONAL    SUICIDE?         99 

endorsement,  in  advance,  approving  the  com- 
pany's policy,  vi^ould  render  it  easily  possible  to 
place  securities  and  would  end  harmful  prevailing 
rumors. 

I  recall  that,  during  the  recent  panic,  in  order 
to  save  certain  financial  institutions,  it  was  neces- 
sary that  the  Tennessee  Coal,  Iron  and  Railroad 
Company  should  be  sold.  It  is  understood  that 
the  United  States  Steel  Corporation  would  not 
buy  the  road  until  President  Roosevelt  sanc- 
tioned its  sale. 

In  a  similar,  urgent  case,  immediate  decision 
rendered  by  a  Corporation  Com't  would  be  use- 
ful. It  would  establish  confidence  in  our  securi- 
ties. 

We  all  know  that  English  manufacturers  of 
silverware  have  their  goods  hall-marked  by  the 
Enghsh  Government.  That  little  mark  is  ac- 
cepted all  over  the  world  guaranteeing  the  fine- 
ness of  the  silver. 

The  suggested  Corporation  Court  would  hall- 
mark our  securities  and  prove  an  additional  aid 
in  securing  and  establishing  national  confidence. 


FIXED    TRAFFIC    RATES    FOR 
FIFTEEN    YEARS 


FIXED    TRAFFIC    RATES    FOR    FIF- 
TEEN YEARS 

A  FTER  health,  service  is  the  greatest  blessing 
that  can  be  conferred  on  the  people  of  our 
nation;  that  is  regular  work,  with  good  pay  for 
all ;  work  well  done,  day  after  day,  with  a  chance 
for  the  laboring  man  to  educate  his  children,  own 
his  home  and  save  money.  Evenly  balanced  con- 
ditions in  business  will  alone  bring  opportunity 
for  labor ;  falling  prices  of  securities  and  financial 
unrest  never  will  secure  these  great  blessings  to 
this  nation.  In  order  to  gain  needed  years  of  rest, 
we  must  end  the  present  period  of  "jumpy"  con- 
ditions, and  give  our  bankers,  for  a  few  years, 
opportunity  to  drop  that  scared-dog  look  which 
they  have  worn  of  late.  This  change  would  prove 
to  be  the  greatest  blessing  possible  to  happen  in 
the  United  States;  so  great,  that  it  is  advisable 
our  President,  Congress,  Governors  and  Legisla- 
tures of  every  state,  should  work  to  solve  the 
problem  during  the  coming  year. 

Now  to  my  mind  the  solution  can  alone  be 
brought  about  by  the  granting  of  a  shght  in- 

103 


104  CONFIDENCE 

crease  in  freight  and  passenger  rates.  After 
these  are  fixed,  so  that  the  net  raih'oad  earnings 
are  one  per  cent,  more  than  at  present,  let  the 
rates  alone  for  fifteen  years ! 

Make  no  changes  for  fifteen  years  and  assure 
railroad  men  and  bond  and  share  holders  that 
they  need  fear  no  radical  rate  changes.  The  very 
day  that  traffic  rates  are  fixedly  established,  (like 
the  price  of  postage  stamps)  for  fifteen  years,  we 
would  inaugurate  a  period  of  the  greatest  pros- 
perity our  nation  has  witnessed. 

The  purses  of  England  and  France  would 
open  in  this  direction.  Capital  would  be  invested 
in  American  land  as  never  before.  Most  manu- 
facturers would  be  pushed  night  and  day  to  fill 
orders,  and  new  industries  would  start.  United 
States  Steel  would  go  to  par  and  remain  there. 
All  labor  would  have  permanent  place  at  good 
pay.  We  would  be  free  from  panics  for  the  next 
fifteen  years,  or,  until  enforcement  of  another  ad- 
justment of  traffic  rates;  but  I  think  by  that  time 
Capital  and  Labor  would  be  so  pleased  with  the 
working  of  the  fixed  rate  system  that  its  fifteen- 
year  period  would  be  extended. 

Presume  the  passenger  rate  were  advanced  one 
mill  per  mile ;  this  amounts  to  but  one  dollar  more 


OR   NATIONAL    SUICIDE?       105 

on  a  ticket  from  New  York  to  Chicago.  Suppose 
freight  rates  were  on  an  average,  advanced  one- 
half  a  mill  per  ton,  per  mile;  that  would  be  only 
fifty  cents  advance  from  New  York  to  Chicago. 
Then  imagine,  ( and  you  cannot  unless  you  are  a 
railroad  man, )  that  this  rate  is  fixedly  established 
for  the  next  fifteen  years.  Tremendous  work 
would  be  immediately  planned.  What  improve- 
ments now  would  be  laid  out  for  1911-1912  and 
1920,  positive  that  during  that  period  there  would 
be  no  fight  for  railroad  existence! 

Under  the  present  changeable  status,  railroads 
plan  for  an  expenditure  of  ten  or  twenty  mil- 
lions; suddenly  some  great  change  is  effected  in 
traffic  rates,  or  railroads  are  enjoined  from  ad- 
vancing these,  and  simultaneously  are  compelled 
to  advance  pay  for  all  labor; — all  the  contem- 
plated improvements  stop! 

During  the  last  four  months,  fully  one  hundred 
million  dollars  of  planned  improvements  for  rail- 
roads have  been  abandoned,  I  have  been  told,  and 
sale  of  railroad  securities  has  been  made  impossi- 
ble because  of  rate  meddling. 

At  least  fifty  million  dollars  of  this  sum  would 
have  gone  into  the  pockets  of  laboring  men.  What 
a  loss  to  labor!    Capital  can  stand  holding  the 


106  CONFIDENCE 

money  idle  even  if  it  earns  no  interest  for  a  while ; 
the  money  remains  in  possession  of  the  capitalist ; 
it  is  lost  by  the  laboring  man. 

TrafRc-rate  regulation  acts  of  the  last  sixty 
days,  are  apt  again  to  establish  the  bread  line  and 
free  soup  as  national  institutions,  and  unless  re- 
action quickly  occurs  this  cannot  be  prevented. 

To  use  a  vulgarism,  our  nation  seems  to  have 
been  "hitting  the  pipe,"  and  mistakenly  enjoying 
hallucinations.  The  national  ear  has  been  close  to 
the  ground,  listening  to  the  people  "damning  the 
railroads";  apparently  the  sweetest  music  was 
the  singing  of  politicians  asseverating  they  were 
"going  for  the  railroads" ;  most  delectable  reading 
was  muck-raking  articles  lambasting  invested 
capital.  Certainly  this  is  "hitting  the  pipe";  it  is 
deadening  progress  with  opium  and  as  helpful  as 
was  Nero's  fiddling  while  Rome  burned. 

Prices  of  land,  corn,  hogs,  cattle,  help,  rent, 
living  and  clothes  have  gone  up  with  bounds  dur- 
ing the  last  decade,  yet  railroad  rates  have  been 
pushed  down  and  all  railroad  running  expenses 
have  increased  exactly  in  proportion  to  the  living 
expenses  of  man.  Not  long  since,  it  was  thought 
that  we  would  have  a  panic  every  nine  years;  now 
it  seems  we  must  welcome  them  every  twenty- 
four  months. 


OR   NATIONAL    SUICIDE?       107 

The  chief  reason  for  this  is,  that  the  raiboads 
are  not  fairly  treated ;  they  are  forced  to  pay 
more  for  material  and  help  than  formerly,  but 
are  not  allowed  to  increase  traffic  rates.  But  even 
if  thus  denied,  conditions  would  not  be  so  bad, 
if  rates  were  definitely  fixed  for  a  period  of  years ; 
if  politicians  and  law  makers  would  let  the  rates 
alone;  stopping  this  endless  agitation  which  leads 
investors  to  think  that  drastic  steps  are  to  be 
taken,  which  certainly  would  put  out  of  business 
some  of  the  roads  that  are  now  fighting  for  bare 
existence. 

This  country  is  growing  fast  and  nothing  helps 
its  growth  like  proper  transportation  facilities. 
James  J.  Hill  says  that  five  hundred  million 
dollars  needs  to  be  expended  by  American  rail- 
roads in  the  next  ten  years.  I  believe  it.  If  some 
law  could  be  passed  calculated  to  overcome  the 
distrust  regarding  our  securities,  this  money 
could  be  found  here  and  in  Europe.  It  will  not 
remain  uninvested,  but  failing  us  will  go  to  up- 
build Argentine,  Chili,  Brazil,  Africa  or  Russia. 
We  could  secure  this  gold  if  a  shght  advance  in 
traffic  rates  were  allowed  and  assurance  given  of 
"hands  off"  for  fifteen  years.  The  Erie  needs 
thirty  million  dollars  and  could  get  it ;  the  Santa 


108  CONFIDENCE 

Fe  could  finish  its  double  track,  which  plan,  the 
English  papers  said,  was  abandoned,  when  the 
proposed  raise  in  rates  was  enjoined.  The  Union 
Pacific  and  other  roads  would  expend  millions. 

Would  you  object  to  this  slight  increase  in 
freight  rates,  which  amounts  to  one-sixteenth  of 
the  present  schedule  ?  Would  you  feel  the  trifling 
increase  of  one  mill  per  mile  in  passenger  rates? 
I  believe  not!  Your  assent  would  secure  pros- 
perity,— the  like  of  which  has  never  been  wit- 
nessed! Our  bonds  and  shares  would  take  their 
proper  place  at  home  and  in  the  eyes  of  foreign 
investors  and  we  would  permit  railroad  develop- 
ment to  keep  pace  with  the  rapid  growth  of  the 
nation.  The  great  prosperity  now  enjoyed  by 
Canada  would  be  secured  for  the  United  States 
and  CONFIDENCE  would  supplant  NA- 
TIONAL SUICIDE. 


AN  AMERICAN  LEGION  OF  HONOR 


AN  AMERICAN  LEGION  OF  HONOR 

T  HAVE  always  thought  that  the  most  needed 
■^  order  in  the  United  States  is  a  LEGION 
OF  HONOR.  There  are  a  number  of  reasons 
for  this.  We  have  men  in  all  parts  of  our  land 
who  are  striving  in  every  way  to  become  public 
benefactors.  In  the  crush  of  business  and  the 
rush  for  wealth,  such  men  are  scarcely  noticed, 
yet  there  is  no  man  who  does  not  love  to  have  his 
good  works  recognized,  and  it  would  be  well  for 
any  nation,  publicly  to  recognize  merit. 

A  number  of  Americans  have  been  made  mem- 
bers of  the  French  Legion  of  Honor,  a  decora- 
tion in  which  they  have  justly  taken  pride. 

In  England,  men  enthusiastically  prosecute  all 
kinds  of  work  for  the  good  of  the  nation,  confi- 
dent that  in  due  time  their  efforts  will  be  nation- 
ally recognized.  Great  writers,  actors,  mer- 
chants, builders,  scientists,  doctors,  bankers,  are 
rewarded  with  the  title,  "Sir,"  or  "Lord,"  or 
achieve  orders  of  merit  for  distinguished  service, 
— precious  above  gold,  and  a  glory  for  their  chil- 
dren and  their  children's  children. 

ui 


112  CONFIDENCE 

Let  us  form  a  Legion  of  Honor  to  reward  our 
great  men,  in  any  walk  of  life,  who  give  all  in 
their  power  to  develop  or  uplift  the  nation.  It 
is  ignoble  that  mere  millionaires  should  be 
thought  to  constitute  American  nobihty! 

The  nation  should  create  a  Legion  of  Merit, — 
an  aristocracy  of  distinguished  national  service! 
We  should  no  longer  count  millionaires  as  great ; 
some  of  these  seem  to  have  striven  to  prove  the 
old  saying  that  large  wealth  cannot  be  earned 
with  kid  gloves.  More  men  would  strive  for  a 
good  reputation  were  this  considered  as  impor- 
tant an  honor  as  the  possession  of  riches. 

We  may  not  now  sail  pirate  craft  with  the 
black  flag  nailed  to  the  mast-head;  we  may  no 
longer  organize  Jesse  James  gangs;  but  we 
have  more  modern  methods  of  robbing,  more 
potent  than  either  of  the  foregoing.  Unfor- 
tunately the  chief  American  strife  has  been  for 
wealth.  Is  it  not  time  that  we  should  give  a  little 
attention  to  other  matters?  What  other  nation 
has  ever  produced  a  man  who  has  achieved  so 
much  for  transportation  as  George  Westing- 
house?  Yet,  do  we  half  appreciate  what  he  gave 
the  world  in  the  air-brake  invention?  We  have 
hundreds  of  men  worthy  to  have  written  before 


OR    NATIONAL    SUICIDE?       113 

their  names: — "Honorable"  and  after  their 
names: — "D.  N.  S." — Distinguished  National 
Service. 

Andrew  Carnegie  has  been  a  great  power 
throughout  the  world.  No  man  in  the  United 
States  has  ever  done  more  than  James  J.  Hill  to 
enlist  confidence  of  foreign  investors  in  American 
railroads.  During  twenty  years  of  work  in 
Europe,  I  have  never  heard  any  man  speak  of 
Mr.  Hill  except  in  praise,  and  there  has  been  no 
loss  in  any  investment  which  he  has  placed.  Mr. 
Flagler  has  been  of  assured  benefit  in  building 
the  Florida  East  Coast  Railroads  and  his  chain 
of  hotels. 

An  organization  of  men  recognized  as  national 
up-builders  would  be  a  powerful  aid  in  counter- 
acting some  of  the  scandalous  reports  made  dur- 
ing the  financial  depression,  and  such  an  insti- 
tution would  be  of  great  use  in  upholding  and 
sustaining  national  credit  and  honor, — helping  to 
estabhsh  confidence. 

Its  word  would  be  potent  in  any  of  the  markets 
of  the  world.  It  would  be  helpful  in  shaping 
public  opinion  when  important  legislation  is  being 
considered. 

I  can  see  no  reason  why  an  American  Legion 


114  CONFIDENCE 

of  Honor  is  not  a  needed  national  institution  and 
why  the  emblem  would  not  be  one  sought  after 
and  worn  with  pride  when  earned. 

I  am  sure  such  an  order  could  be  incorporated 
by  a  bill  in  Congress,  giving  the  President  the 
right  to  name  the  first  twenty-five  members.  We 
could  all  rest  assured  that  he  would  make  a  wise 
selection.  They,  in  turn,  might  have  the  power, 
annually  of  conferring  the  title  of  "Distinguished 
National  Service,"  on  perhaps  twenty  or  thirty 
additional  members. 

In  time  we  would  look  with  liigh  respect  on 
such  organization.  I  am  quite  aware  of  the  fact 
that  a  number  of  our  leading  men  will  occupy  a 
place  in  the  Hall  of  Fame ;  yet  there  is  very  little 
fattening  in  post  mortem  glory! 


LET    US    BE    FAIR  I 


LET  US  BE  FAIR! 

TNCREASED  prosperity  for  the  railroads, 
largest  employers  of  labor  in  America,  and 
increased  traffic  rates  are  exactly  what  every  one 
wants  brought  about. 

This  may  be  thought  a  rash  statement,  but 
nevertheless  is  a  fact.  The  reader  may  not  ac- 
knowledge that  he  wishes  this  consummation,  so 
in  this  concluding  chapter  I  shall  state  my  rea- 
sons for  the  above  expressed  belief. 

In  the  first  place,  everyone  in  the  nation  is 
blest,  when  abundant  prosperity  exists  along  all 
walks  of  life. 

In  1892  or  1893,  corn  ranged  from  seven  to  ten 
cents  a  bushel;  this  price  brought  no  one  any 
good,^ — it  starved  the  farmer,  foreclosed  a  vast 
number  of  mortgages,  and  brought  general  ruin 
to  merchants,  since  the  farmer  had  no  money  to 
spend.  It  restricted  trade  of  all  kinds,  and  all 
building  operations. 

Let  us  exaggerate!  Suppose  the  Interstate 
Commerce  Commission  not  only  fixed  the  rail- 
road rates,  but  also  established  the  market  price 
of  corn! 

117 


118  CONFIDENCE 

If  the  Interstate  Commerce  Commission 
should  now  cut  the  price  of  corn  to  seven  cents  a 
bushel,  no  one  would  be  benefited.  Perhaps  the 
laboring  man  may  think  this  would  aid  him,  by 
reducing  the  cost  of  living;  but  if  it  restricts  the 
prosperity  of  the  country,  it  reduces  the  price  of 
labor,  and  if  the  laborer  need  pay  less  for  food, 
still  he  receives  less  wages,  and  perhaps  would 
become  one  of  thousands  out  of  work. 

Now,  as  to  railroad  rates:  since  railroads  are 
the  Hfe  of  the  nation's  progress  why  not  grant 
them  abundant  favors?  The  farmer  enjoys 
prosperity;  mth  high  prices  for  farm  products, 
and  no  one  should  begrudge  the  farmer ;  the  mer- 
chant and  manufacturer  delight  in  it,  and  no  one 
begrudges  them! 

Let  me  illustrate  what  a  period  of  injustice  we 
are  experiencing. 

A  manufacturer  of  lumber,  of  a  western  town, 
was  calling  in  New  York  on  some  old  friends  of 
his  boyhood  days.  He  had  gone  west  years  be- 
fore, bought  a  timber  tract,  and  when  a  railroad 
came  near,  began  the  manufacture  of  lumber. 

The  present  price  of  lumber,  we  all  know,  is 
about  three  times  that  of  1892, — the  time  of  cheap 
corn.     The  manufacturer,  boasting  of  his  won- 


OR   NATIONAL    SUICIDE?       119 

derful  prosperity,  said:  "Year  before  last,  I 
netted  four  hundred  thousand  dollars;  I  did  not 
know  what  to  do  with  the  money,  so  I  turned  the 
business  over  to  my  son  and  partner,  and  went  to 
Europe.  I  thought  that  without  myself  at  the 
concern's  head,  not  much  could  be  made  the  next 
year.  To  my  surprise,  it  was  five  hundred  and 
twenty  thousand  dollars  net.  I  tell  you,  it's  fine 
to  have  money  roll  in  that  way ;  for  ten  years  be- 
fore, the  best  I  could  do  was  to  make  a  living.  By 
the  way,  old  man,  as  you  are  in  the  railroad  busi- 
ness, I  just  want  to  say  that  our  Governor  is  a 
'cracker-jack';  he  is  going  for  the  railroads  hard, 
and  just  forcing  them  to  reduce  rates !  I  lunched 
with  him  the  other  day,  and  on  leaving,  said,  slap- 
ping him  on  the  back:  'Go  for  them.  Governor, 
hit  'em  hard:  you're  a  brick!'  " 

Now,  this  story  is  not  overdrawn. 

Consider  the  unreasonableness  of  that  man,  re- 
counting the  great  prosperity  he  was  enjoying; 
yet  the  railroad, — an  instrument  made  with  other 
people's  money,  and  which  enabled  him  to  become 
a  rich  man, — must  be  sacrificed.  He  is  unwilling 
that  stockholders  of  this  railroad,  his  ladder  to 
success,  shall  share  in  the  general  prosperity. 


120  CONFIDENCE 

That  a  man  should  so  reason  makes  one  think 
higher  of  his  dog's  instinct ! 

Let's  be  fair !  Let  us  be  American !  From  now 
on,  let  us  fight  for  abundant  prosperity  for  the 
railroads,  just  so  long  as  we  desire  prosperity  in 
our  indi\adual  affairs  and  for  the  nation! 


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